Bombay HC restrains IDBI trustee from selling Future Retail's share until further orders

Mumbai: In a major relief to the promoters of the Future Group, the Bombay High Court on Monday restrained IDBI Trusteeship and others from selling the pledged shares in Future Retail until further orders. The court will consider the case next on May 4. Two group companies of the Kishore Biyani-promoted Future Group - Future Corporate Resource (FCRPL) and Rural Fairprice Wholesale Ltd (RFWL) - approached the court on Monday to restrain the trustee from selling the pledged shares. The other respondents in the case are UBS AG’s London branch and IDBI Bank.

Future Retail’s share price has fallen from Rs 350 on the date of the debenture trust deed to Rs 303 at the start of this month, due to the market collapse in the wake of the Covid-19 crisis, senior counsel Vikram Nankani and lawyer Somasekhar Sundaresan argued in the court on behalf of the Future Group. As per the debenture trust deed, the defendants are fully secured, they said. On Monday, the shares closed at `82.85 on the BSE.

If the shares are sold in the current situation, it will cause irreparable loss to the promoters and hence the trustee should restrain from selling the pledged shares until the next date of hearing, the counsels pleaded in the court.

While countering this, lawyers for the IDBI Trusteeship argued that it had to recover more than Rs 650 crore from the company and as per the current market value, the shares were worth not more than Rs 350 crore and hence there was no question of granting any ad-interim relief to the company at this moment. Justice, KK Tated said considering the current situation of the market and Covid-19, he was of the opinion that FCRPL and RFWL required protection till the next date of hearing.