Reliance Industries and Future Retail shares climbed up few no notches on RIL-Future deal post SEBI nod

Reliance share price: RIL stock rose by as much as 3.07 per cent to Rs 2118.00 per share on the BSE, while the script rose by 3.08 per cent to Rs 2,118.00 per share on the National Stock Exchange (NSE). The Future Retail shares were also locked on both exchanges in the 5% upper circuit.
Reliance chairman and managing director Mukesh Ambani. Pic Credits: Bloomberg

During the late morning deals on Thursday, shares of Reliance Industries (RIL) rose over 3 percent after the oil-to-telecom behemoth obtained a go-ahead from the Securities and Exchange Board of India (SEBI) for its contract with Future Group. 

The RIL stock climbed by as much as 3.07 percent to Rs 2118.00 per share on the BSE, while the scrip grew by 3.08 percent to Rs 2,118.00 per share on the National Stock Exchange (NSE). 

Over 9.35 lakh shares were traded on BSE so far in the intraday session, while 1.07 crore shares exchanged hands on NSE, data from the respective stock exchanges show.

Shares in Potential Retail were also locked on both exchanges in the upper 5% circuit. It was frozen at Rs 81.35 for BSE, while it was locked at Rs 80.65 for NSE. 

In August of last year, in a mega-deal involving the consideration of Rs 24,713 crore, Mukesh Ambani's RIL agreed to acquire the retail company of Kishore Biyani-led Future Group. Amazon said the contract was a breach of a non-compete clause and a right-of-first-refusal pact it had negotiated with the Future Party since Future's arrangement with RIL. The contract also allowed Potential Community to contact Amazon before entering into any third party purchase arrangement.

The Future Group, for its part, stated that it had not sold any of its shares in the company and merely sold its assets and had therefore not breached any of the terms of the contract. Amazon also sent a letter to the SEBI, the Bombay Stock Exchange, and the NSE along these lines, urging them not to authorize the Future-Reliance arrangement since there was an interim stay order on it. 

On Wednesday, the market regulator acknowledged the transaction and noted that "the company shall ensure that the shares of the transferor entity issued instead of the locked-in shares of the transferor entity are locked-in for the remainder of the post-scheme period."

'The company shall ensure that proceedings pending before SEBI against entities belonging to the promoter/promoter group or which are directors of companies participating in the scheme are set out in the scheme document submitted to the National Company Law Tribunal (NCLT),' the company further added in the letter.

The approval comes a month after Amazon asked SEBI to suspend its review of the Rs 24,713 crore deal and not grant certification of no objection on the ground that before the Delhi High Court its challenge to the agreement was.