Reliance & Future Retail shares soar after Competition Commission clears RIL's acquisition

On Monday, shares of Reliance Industries Ltd (RIL) closed nearly 3% higher after the Competition Commission Of India (CCI) approved the company's proposed acquisition of retail, wholesale, logistics and warehousing businesses of Future Group. Future Group stocks were also in heavy demand, rising up to 10%, PTI reported. 

RIL shares rose 2.72% to close at Rs 1,950.80 on the BSE. During the day, it gained 3.72% to Rs 1,970. On the NSE, it jumped 2.93% to close at Rs 1,955.20. The company's market valuation rose by Rs 34,892.12 crore to Rs 13,19,138.30 crore on the BSE.

Besides, Future Retail shares zoomed 9.95% to Rs 79 -- its upper circuit limit, Future Lifestyle Fashions gained 9.99% to Rs 90.30 and Future Enterprises Ltd shares rose 4.92% to its highest trading permissible limit for the day at Rs 10.45 on the BSE. The Rs 24,713-crore deal that would boost RIL's fast-growing retail business was announced in August.

CCI clears Future Group-Reliance Retail deal

In a tweet on Friday, the regulator said it has approved "acquisition of retail, wholesale, logistics and warehousing businesses of Future Group by Reliance Retail Ventures Limited and Reliance Retail and Fashion Lifestyle Limited". Deals beyond a certain threshold require the approval of the Competition Commission of India (CCI), which keeps a tab on unfair business practices across sectors. 

Reliance buys Future Group

"Reliance Retail Ventures Ltd (RRVL), subsidiary of Reliance Industries, will acquire the retail and wholesale business and the logistics and warehousing business from the Future Group as going concerns on a slump sale basis for lumpsum aggregate consideration of Rs 24,713 crore," the company said in a statement.

Through the deal, Reliance will acquire Future Retail that owns the BigBazaar that sells everything from groceries to cosmetics and apparel, and Future Lifestyle Fashions Ltd that operates fashion discount chain Brand Factory. While Reliance will takeover Future Consumer Ltd, which sells food, home, and personal care products, Future Group's financial and insurance business is not part of the deal. Future Retail operates 1,550 stores. Its flagship brands are BigBazaar, FBB and Foodhall, Easyday, Heritage Fresh and WHSmith. Future Lifestyle Fashion operates 354 stores.

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Delhi High Court reserves order on Future's plea

Meanwhile, the Delhi High Court on Friday reserved order on an application by Kishore Biyani led Future Retail Ltd (FRL) seeking to injunct Amazon from interfering in the Rs 24,713 crores Reliance-Future deal on the basis of an interim order passed by the Singapore International Arbitration Centre (SIAC). Justice Mukta Gupta heard arguments for five days and asked the parties to give written submissions, if any, by November 23. The Future Group and Amazon have been locked in a battle after the US-based company took FRL into an emergency arbitration over an alleged breach of contract.

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