otr: Future Retail misses 3,000 crore payment date to its lenders under RBI’s OTR program for businesses affected by Covid

On Friday failed to make the planned 3,000 crore payments to its lenders under the central bank’s One-Time Restructuring Program (OTR) for businesses affected by Covid-19, people with knowledge of the matter told ET. .

As per the OTR program signed in April this year, Future Retail was supposed to raise 3,000 crore by selling its small-format stores nationwide, numbering around 900. But Future Retail was unable to sell these stores. to a third party because he had agreed to sell them to companies linked to Reliance Industries under an agreement dated August 29, 2020.

The closing date for the transaction with Reliance, which has been extended twice, ends on March 31, 2022. By then, Future Group is bound by the 2020 agreement with

and therefore cannot sell the stores to others.

The hypermarket promoted by Kishore Biyani has a grace period of one month to make OTR payments. This grace period ends on January 30. If payments are not made by then, the account would be classified as a non-performing asset (NPA) and the concessions under the OTR would be recalled by lenders.

This classification would apply from the date the account became NPA according to the standards stipulated by RBI if the OTR was not signed. The date of classification of the NPA would vary from bank to bank. Future Retail did not respond to questions sent by ET.

Future Retail has loans of over Rs 10,000 crore. These include short and long term loans of around Rs 6,200 crore. Foreign currency bonds worth around Rs 3,500 crore, due 2025, are also outstanding, as are non-convertible bonds of Rs 200 crore.

A dispute between Amazon and Future Retail has delayed the multi-stage acquisition of the retailer by companies linked to Reliance Industries. The U.S. e-commerce giant is seeking to block Future Group’s proposed deal with Reliance Industries, saying its previous deal with Future Coupon prevents Future Retail from selling its assets to Reliance Group entities. The Supreme Court is due to hear the case on January 11.

The Indian Competition Commission (ICC) decision on December 17 to suspend its approval of Amazon.com’s investment in Future Coupon has given lenders some hope over the deal between Reliance and Future Group, someone familiar with the developments told ET. CCI said Amazon misled the commission about its goal of investing in Future Coupon and ordered Amazon to seek re-approval on the deal within 60 days.

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Elaine R. Knight