The sharp decline in the share value of Future Group and the possibility of insolvency proceedings looming large, worried shareholders have written to the markets regulator SEBI urging it to protect the interests of thousands of shareholders and launch an investigation into the actions of its board members.
In a Twitter Spaces session with The Plunge Daily , Vijay Kulkarni, an advocate and a Future Retail shareholder, raised several pertinent questions regarding the conduct of the FRL board and also alleged that nothing was done to safeguard the interest of shareholders.
Kulkarni questioned the strong resistance by Future Group against Amazon’s Rs 7,000 crore offer which was made earlier this year.
“Why Future Group was strongly opposed to Amazon’s Rs 7,000 crore offer ? Amazon repeatedly said that they want to go through the books of accounts and based on that they were willing to revise the offer. I would like to ask this question to the directors of Future Group: what was so wrong in showing your books of accounts to Amazon and why was there so much resistance to not taking any help from Amazon? Moreover, If you had any alternatives planned in the event of reliance saying no, why was this not disclosed to shareholders?” he asked.
He said shareholders, banks, and other stakeholders have incurred massive losses due to the transfer of assets and leasehold properties and asserted that regulators must conduct a thorough probe in the entire matter.
“What was promised to us as a retail investor, institutional investor, HNIs , corporate investors, what’s being disclosed and done is not consistent with statutory regulations. It’s my appeal to regulators like SEBI and RBI to launch a proper investigation in this whole matter. It’s a test of the regulators in our country.
Mr Kulkarni pointed out that FRL’s response to NSE after the ‘forceful’ take over of its stores by Reliance was vague and the fact that what will happen to shareholders was not taken into account.
“In its response to NSE, FRL stated that Reliance unilaterally terminated the lease and forcefully took over control of hundreds of Future retail stores which had been intimated to the stock exchanges. What I fail to understand, even if you had an agreement, is the problem in acquiring these things in a proper legal manner. The matter was sub judice. The same assets were being discussed before Delhi High Court and honourable Supreme Court. Still, this was allowed to happen. Now Reliance may say they have their own defense. But now as a shareholder of future retail myself and hundreds of other shareholders, how are we going to be assured that nothing wrong has happened?
He also referred to several board members and directors taking the exit route while shareholders have no idea what’s in store for them.
“Whom should we approach- the board directors? How many are left now? Many of them have resigned. The Managing director is saying I don’t want to continue because I have completed my term. Who is replacing them? We have no idea. Even the group CEO has no time to meet the shareholders. We were left with no options but to approach regulators,” he concluded.