Indian retail corporation Future Retail has reportedly closed the offline and online activities of its Big Bazaar banner amid plans by Reliance Retail to take over and rebrand the brand’s stores next week.
The move comes after Future Retail missed lease payments to Reliance.
Future Retail is said to have closed its e-commerce mobile app and website for online orders.
Citing insiders, Reuters reported that all Future Retail stores were closed as Reliance carried out stock-taking exercises ahead of a rebranding.
Reliance plans to rebrand 200 Big Bazaar stores and has agreed to retain all their employees on existing terms.
Although the two companies did not respond to requests for comment, Future Retail has informed stock exchanges that the company is ‘scaling down its operations’.
In August 2020, Reliance Industries subsidiary Reliance Retail Ventures agreed to acquire some of Future Group’s businesses for $3.38bn. Future’s partner reportedly later blocked the deal by citing a violation of contracts.
Last August, Amazon won a legal battle against Reliance Industries’ acquisition of Future Group’s assets.
Reliance’s latest move is said to have disrupted Amazon’s plans, with the e-commerce giant expecting to own a piece of Future’s stores itself.
A lawyer familiar with the development said that the store landlords had independently given the land leases to Reliance.
In October last year, Future Retail cancelled a master franchise agreement with 7-Eleven after the company’s joint subsidiary, Future-7 India, failed to meet its target of opening stores and paying franchisee fees.
Future Retail signed an agreement with 7-Eleven in February 2019 to establish and operate 7-Eleven convenience stores in India.
The country’s first 7-Eleven store was due to open in Mumbai by March 2020, but this was delayed due to the Covid-19 pandemic.