Prominent public sector banks (PSBs) voted against the proposed deal between Future Retail (FRL) and Reliance Retail Ventures (RRVL), sources told CNBC-TV18 on Friday, after the voting process ended on Thursday.
However, the bondholders’ decision was still unclear, leaving room for them to swing the outcome of the vote.
According to the sources, Union Bank of India, Bank of India, State Bank of India and Bank of Baroda are among the lenders who voted against the deal.
The sources, who did not want to be named, added that the banks are against the Rs 24,713 crore deal due to RRVL’s lack of assurance on debt repayment and valuation of the deal after renegotiation. .
“We are not aware of the negotiations between Future and Reliance, and after the store takeover, we want Reliance to provide reassurance that it will settle the dues,” a senior executive from a major bank told CNBC-TV18 earlier. of the public sector.
Another banker expressed reservations that the value of the deal could drop significantly as more than 800 Future Retail stores have already been taken over by Reliance, leaving no clarity as to how RIL could assess the deal.
The vote proceeded pursuant to an order of the National Company Law Tribunal (NCLT) issued on February 28 after the Supreme Court allowed Future Group companies to call a meeting of shareholders and secured and unsecured creditors to seek their approval for the deal.
Future Retail owes over Rs 17,000 crore to lenders including Bank of India, SBI, BoB, Union Bank and Axis Bank.
After a series of defaults by Future Retail, even after the approval of a unique debt restructuring plan by the lenders, Bank of India last week filed an insolvency petition against the company with the National Company. Law Tribunal to recover contributions.
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First post: STI