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Reliance Retail has initiated a major internal restructuring by transferring its fast-moving consumer goods (FMCG) brands business to a newly formed entity New Reliance Consumer Products Ltd (New RCPL). The move, cleared for creditor approval by the National Company Law Tribunal (NCLT) in Mumbai, is intended to grant the consumer brands division more focused management, dedicated resources, and investment potential. New RCPL will mirror the same shareholding structure as Reliance Retail Ventures Ltd (RRVL), with the consumer business being transferred as a going concern through a slump sale.
Reliance Retail has taken a decisive step toward strengthening its consumer-facing portfolio by carving out its FMCG brands division into a newly formed entity New Reliance Consumer Products Ltd (New RCPL). The internal restructuring scheme, recently reviewed by the Mumbai bench of the National Company Law Tribunal (NCLT), involves transferring the consumer brands business from Reliance Retail Ltd (RRL) to New RCPL through a slump sale. This transfer categorizes the business as a going concern, ensuring continuity in operations, workforce, and investments. Advertisement
The tribunal directed that a meeting of unsecured creditors of RRL, Reliance Retail Ventures Ltd (RRVL), and the existing Reliance Consumer Products Ltd (RCPL) be conducted within 70 days of the order being uploaded, to obtain their formal approval for the restructuring scheme.
Company sources explained that the consumer brands business involves extensive brand-building, product lifecycle management, manufacturing, distribution, and marketing all of which require a highly specialized approach. The segment, according to them, is substantial in size and demands focused leadership and distinct skill sets that are different from those required in the core retail supply chain and logistics business.
They pointed out that the consumer business calls for significant ongoing capital investments and presents an opportunity to attract a different category of investors. By isolating this business into a new entity, the company aims to enable sharper execution and potential fundraising through strategic partnerships or external investments.
The restructuring will not alter shareholding patterns investors in RRVL, including Reliance Industries Ltd (RIL), will retain their proportional stakes in New RCPL. While RRL continues to focus on retail operations and logistics, RCPL and now New RCPL will anchor the group's growing FMCG ambitions. RCPL currently manufactures, markets, and distributes a variety of products and also holds investments in subsidiaries and joint ventures engaged in the same segment.
Reliance's foray into the FMCG segment has been aggressive in recent years. The company launched its own brands, acquired Campa Cola, and expanded into packaged foods, beverages, and home essentials. With this structural overhaul, the group appears poised to sharpen its consumer brand strategy further and compete with established players like Hindustan Unilever, ITC, and Nestle India.
Source PTI
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