In May 2015, a deal was struck. It was a consolidation of two major retail businesses in India -- Bharti Retail and Future Group. What transpired between the two Groups was that Future Group will merge its retail business with rival Bharti Retail in an all-stock deal worth Rs 750 crore to create one of the biggest supermarket chains with Rs 15,000 crore turnover.
Moving ahead with the merger, this year on May 2, Future Group’s Chairman Kishore Biyani resigned from the post of managing director of Future Retail Ltd (FRL) as a part of rearrangement of the group's business. In a similar move, Rakesh Biyani also quit from the post of joint managing director as well as director of the company. However, Kishore Biyani would continue to hold office as non-executive director of Future Retail Ltd, it added.
On Tuesday, Kishore Biyani was appointed as the Managing Director of Bharti Retail, while Rakesh Biyani has been inducted as the Joint Managing Director of Bharti Retail – the company will be later renamed to Future Retail Ltd and will be listed on the stock exchanges. This move is part of the board reconstitution following the merger deal between the two companies.
The merger has made it possible for the big two to not just consolidate in the retail space but also create two separate businesses out of it – one the front-end retail (soon to be named Future Retail Ltd) and an infrastructure entity which will own and manage the back-end retail infrastructure for operating the retail networks as well as the investments in various Future Group companies. This second entity, according to sources will be renamed as Future Enterprises.
Rajan Mittal, vice chairman and managing director of Bharti Enterprises Ltd, will continue to serve as a member of the board of directors of the company. As part of its management rejig, Future Group said that former CEO of Bennett, Coleman & Co Ltd Ravi Dhariwal, JLL India CEO-business Gagan Singh and ex-MD and CEO of ING Vysya Bank Shailendra Bhandari have also come up on the board of Bharti Retail as independent directors. And a Future Group veteran C P Toshniwal has been appointed as the CFO of the company.
"Future Group has given effect to the scheme of arrangement between Future Retail Ltd and Bharti Retail Ltd for acquisition of the retail operations of Bharti Group. The Boards of the two companies have been reconstituted to ensure proper representation of promoters and the professional Board," the group said in a statement.
Future Group said as part of the merger, Bharti Retail will be listed on stock exchanges NSE and BSE. It has also set May 12 as the record date to ascertain the entitlement of Future Retail shareholders to receive Bharti Retail shares. Future Group operates some of the most popular retail brands in the country including Big Bazaar, EasyDay, fbb, Foodhall, Home Town and eZone.