Reliance Retail Ventures Limited (RRVL), the retail arm of Reliance Industries, has extended the Long Stop Date for completion of its £2.47 billion deal with Future Group by another six months to 31 March next year in view of the long-drawn-out legal battle with Amazon, Future Retail said in a regulatory filing.
Earlier, RRVL had extended the timeline for the Long Stop Date from March 31, 2021 to September 30, 2021, said Future Retail. Long Stop, an established practice in mergers & Acquisition transaction, is a timeframe in which parties agree on which all the conditions precedent for a transaction need to be fulfilled and the transaction completed.
Last year in August, RRVL had announced that it had acquired Future Group's retail business across the apparel, lifestyle and grocery segment. They said they were paying close to £2.5 billion in exchange for some of the most iconic retail brands of our time - Big Bazaar, Nilgiris, fbb, Easyday, Central, and Brand Factory.
But just when all of us thought the deal was about to be consummated, Amazon, an investor in Future Coupons that in turn is a shareholder in Future Retail Ltd, intervened. They were livid that Future Group was selling a sizeable part of its retail business to Reliance without their explicit consent.
In August 2019, Amazon had agreed to purchase 49% of one of Future's unlisted firm, Future Coupons Ltd (which owns 7.3% equity in BSE-listed Future Retail through convertible warrants), with the right to buy into the flagship Future Retail after a period of 3 to 10 years.