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Jindal India throws its hat in the ring for Future Enterprises by submitting debt resolution plan

According to those briefed on the situation, Jindal (India), supported by the family that owns Jindal Poly Films, has filed a debt resolution plan for Future Enterprises under the Insolvency and Bankruptcy Code (IBC) procedure.

According to the individuals mentioned above, this might put the business up against Reliance Retail, which is headed by Mukesh Ambani and has requested until October 30 to determine whether to submit a bid for Future Enterprises.

Since Jindal’s bid was filed in a sealed envelope, as is customary for private financial bids made under the IBC, specifics of the bid could not be determined. Only once Reliance Retail notifies Future Enterprises’ creditors of its intention to either forward with the bidding process or withdraw, will the offer be made.

Future Enterprises owes the government Rs 11,000 crore. In response to a petition filed by a creditor alleging the company had failed on payments, the National Company Law Tribunal admitted it for insolvency proceedings on February 27.

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Creditors of Jindal India hope for a better outcome from the process:

Creditors are hoping for a better outcome from the insolvency process of Future Enterprises, which owns stakes in life and general insurance joint ventures that Future Group promoter Kishore Biyani had struck with Italy’s Generali group in 2006. This is in contrast to its sister concern Future Retail, which only received bids from scrap dealers.

Huge loan write-offs are in front of Future Retail’s creditors. The Insolvency and Bankruptcy Board of India’s website contained data indicating that the company owed Rs 20,000 crore to its financial creditors, which included banks. An online scrap dealer based in Gurugram made the company the greatest offer for debt resolution, which came in at Rs 550 crore.

The successful bidder may acquire a nearly 9% stake in Future Generali’s life insurance business in addition to becoming the lawful owner of a 25.5% stake in the company’s general insurance, assuming that Future Enterprises’ insolvency process produces a better debt resolution acceptable to all creditors.

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