India's most valuable firm said in a stock exchange filing that it couldn't implement its $3.4 billion deal to acquire parts of retail chain Future Group.
The results of the voting on the scheme of arrangement by the shareholders of Future Retail and other listed companies involved in the scheme have been intimated. The scheme has been approved by the shareholders and theUnsecured Creditors of FRL. The scheme has been voted against by the secured creditor. Reliance Industries said that the subject scheme of arrangement cannot be implemented.
The battle between Reliance and Future, which runs two of India's largest retail chains, has been going on for two years.
Three years ago, Amazon invested in one of Future Group's units, and last month it accused Future Group and Reliance Industries of fraudulent practices.
Amazon has argued that Future Group has violated its contract by doing a deal with Reliance, and earlier approached the Singapore arbitrator to stop the deal between the Indian firms. Future Group's debt piled up and earned a once-iconic Indian company a non-performing asset evaluation.
Reliance took over several Future stores in February after brokering deals with land owners in a move that surprised and outsmarted the U.S. firm. Future said in a filing that it couldn't pay rent at many outlets and was scaling down its operations. The episode lowered bankers' confidence.
Future Group, which has more than $4 billion in debt on its books, is unlikely to survive without secured lender backing. The National Company Law Tribunal in India allowed Future Retail and other group companies to convene meetings of shareholders and other stakeholders to vote on the proposed acquisition of Reliance Industries.
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