Biyani withdraws resignation from post of exec chairman, director of FRL

Kishore Biyani has withdrawn his resignation from the position of executive chairman and director of Future Retail (FRL) on March 10, the company said in a stock exchange filing.

The letter was received by the by resolution professional through e-mail on Tuesday.

Biyani had resigned from his position of executive chairman and director of Future Retail on January 23 and his resignation letter has been placed before the Committee of Creditors, as per the Insolvency and Bankruptcy Code.

“In response to the said letter, the resolution professional of the company had vide mail dated 1 st February 2023 objected to the contents of the said letter and the resignation by Mr Biyani and requested him to recall his resignation letter,” the company said in its filing.

Troubles for Future Retail began due to mounting debt coupled with its operations also taking a hit due to the lockdowns and curbs due to the spread of Covid-10 which had an impact on its sales and also its net worth.

In an exchange filing last year, the company had said that the second and third wave of the pandemic has worsened the financial condition of the company and its strained cash flow led to build up of unpaid dues to vendors and lessors.

In August 2020, it had announced a scheme of arrangement (scheme to sell Future Group’s retail, logistics, and warehousing businesses to Reliance Retail for Rs 24,713 crore) with Reliance Group which not only ensured continuity of business but also a significant repayment of dues to lenders as well as protected interest of all other stakeholders.

Post the announcement of the scheme with Reliance Group the retailer was unable to raise any additional capital and thus continued to remain in default on various commitments.

It had also informed exchanged that many of its lessors had issued termination notices to the company and filed suits for recovery and eviction from properties post which the Reliance Group reached out to these lessors and signed fresh lease deed in respect of such properties and sub-leased on a leave & license basis to FRL.

In February last year, Reliance Group also unilaterally terminated the leases and took over control of hundreds of Future Retail’s stores.

In April, Reliance Retail said it will not go ahead with its scheme of arrangement with Future Group after secured lenders to the Kishore Biyani-led company voted against the scheme.

Following which in July, The Mumbai bench of National Company Law Tribunal (NCLT) on admitted Bank of India’s petition under Section 7 of Insolvency and Bankruptcy Code (IBC) to start insolvency proceedings against Future Retail and also appointed an interim resolution professional (IRP) in the matter.

The public sector lender had moved the insolvency petition against Future Retail back on April 14 for non-payment of dues under the terms of agreement entered into between the Future Group and the bank.

In August, Future Retail, which is under the corporate insolvency resolution process, received claims to the tune of Rs 21,057 crores from 33 financial creditors.

Adani Group, Reliance Industries were among the 15 entities that have submitted their expressions of interest to acquire the assets of the bankrupt retailer.