Big Bazaar Shuts Down Across India: Reliance Will Rebrand 200 Big Bazaar Outlets & Run Operations
India’s second-largest retailer Future Retail Limited or FRL has suspended most of its online and offline operations after Reliance took over at least 200 of its stores due to missed lease payments.
Reliance Industries Limited or RIL will rebrand the stores since FRL could not pay for them, thereby closing most outlets of the popular Big Bazaar chain.
Rebranding Happening Soon
FRL told stock exchanges on Saturday the company was “scaling down its operations”.
Its stores across India remained shut as Reliance did stock-taking ahead of a rebranding.
It will now run and rebrand the outlets that would otherwise be closed but the balance stores will continue to be run by FRL, ensuring that its operating losses are reduced and it can continue as a going concern.
Online And Offline Businesses Closed
Big Bazaar told its customers that the stores will be non-operational for 2 days.
Its online business, the e-commerce mobile app and website were also unavailable for ordering.
Reliance has stepped in at a crucial time, considering the acquisition deal announced in 2020 is stuck in a legal battle with Amazon.
Financial And Legal Struggles
The deal got mired in a legal conflict when Amazon objected to it.
Already cash-strapped, Future Group has been defaulting on payments to lenders and struggling to keep its stores open.
It has also defaulted in payment of dues to the owners of the leased premises.
Consequently, many have initiated termination of the lease agreements for repossession of the premises.
Reliance To The Rescue
Reliance transferred the leases of some stores to its name and sublet them to Future to operate the stores.
It will re-employ Future Retail staff working at these locations and bring them under its payroll.
At least 30,000 such employees are being given offer letters and over the next few days Reliance will begin the rebranding.
Reliance’s move upsets Amazon’s plans as it had hoped to get a share of FRL stores.
However landlords appear to have independently given the leases to Reliance.