A woman checks her phone next to a Reliance Retail kiosk.
Credit: Reuters File Photo
New Delhi: Reliance Retail is transferring its consumer goods business to a new entity, New Reliance Consumer Products Ltd (New RCPL).
As per the scheme filed before the NCLT, Reliance is transfering and vesting the FMCG brands business from Reliance Retail Ltd (RRL) to a new entity named New Reliance Consumer Products Ltd (New RCPL).
The Mumbai bench of the National Company Law Tribunal (NCLT) on June 25 asked to convene a meeting for approval of the internal restructuring process, under which its consumer business is transferred as a going concern on Slump Sale.
Explaining the reasons, Reliance firms said the Consumer Brands Business is one of building brands, managing entire product lifecycle from research, development, manufacturing, distribution and marketing.
"This is a large business by itself requiring specialised and focused attention, expertise and different skill sets as compared to retail business. This business also entails large capital investments on an on-going basis and can attract different set of investors," it said.
This composite scheme, part of internal restructuring of companies in the RIL group to house the Consumer Brands Business in New RCPL and will have RIL and other investors of RRVL holding the same percentage shareholding as in RRVL, they said.
NCLT directed that a meeting of the unsecured creditors of RRL, RRVL and RCPL be convened and held within 70 days from the date of the order being uploaded on its website, for the purpose of considering and approving the Scheme.
RRVL primarily carries on the business of supply chain and logistics management for retail business of Reliance, while RCPL is engaged in manufacturing, distribution, selling and marketing of multiple products under FMCG category and investments in subsidiaries and joint ventures engaged in FMCG category retail business.