Shares of Future Group Companies jumped on Monday with Reliance Industries Ltd (RIL) stepping in to rescue Future Retail.

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Shares of Future Retail, Future Enterprises, Future Supply Chain Solutions, Future Lifestyle Fashions and Future Consumer gained 6-14 percent.

RIL has stepped in to rescue Future Retail, taking over the operations of its stores and offering jobs to its employees, even as the Kishore Biyani-led group is locked in a bitter legal wrangle with e-commerce major Amazon at several judicial forums over the sale of its business to the retail arm of the oil-to-telecom conglomerate, a report said.

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Reliance Retail has started taking over operations of Future Retail stores such as Big Bazaar and replaced them with its brand stores, the report said.

Future Retail had explained in an exchange filing over the weekend that it is going through an acute financial crisis and has defaulted on its loan

servicing with the account of the company being classified as a non-performing asset by the banks.

Further, the ongoing legal tussle with Amazon has aggravated the condition by creating serious impediments in the implementation of the Scheme with Reliance entities. This has weighed adversely on the working of Future Retail, said the company.

Also Read | Future Retail seeks more time from lenders to present debt recast plan

“The Company has been finding it difficult to finance the working capital needs. Increasing losses at the store level is a grave concern and is a vicious cycle where larger operations are leading to higher losses. The Company has made a loss of Rs. 4,445 crore in the last four quarters. Termination notices have been received for a significant number of stores due to huge outstanding, and we would no longer have access to such store premises,” Future Retail said in an exchange filing.

“The Company is scaling down its operations which will help us in reducing losses in the coming months. The Company is proposing to expand its online and home delivery business, to increase its reach to the customers,” it added.

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