Companies

Future Retail terminates deal to roll out 7-Eleven stores in India

Our Bureau Mumbai | Updated on October 05, 2021

Kishore Biyani

Kishore Biyani-led firm was unable to meet store opening target, pay franchisee fees

Global convenience store chain 7-Eleven INC and Future Retail have terminated their contract to set up 7-Eleven stores in India.

Debt-strapped Future Retail informed the exchanges on Tuesday that “the termination has been with mutual consent as the Future-7 was not able to meet the target of opening stores and payment of franchisee fees. No financial or business impact on the Company as this arrangement was at subsidiary company level.”

7-Eleven, which has over 67,000 convenience stores in 17 countries, had signed a master franchise agreement with a Future Retail Ltd arm, SHME Food Brands Pvt Ltd, to develop and operate 7-Eleven outlets in India.

The retailer has been exploring an India entry since 2004, when it was in talks with Delhi-based Modi Enterprises. In February 2019, Future Retail had signed an agreement with 7-Eleven.

Earlier plans

Kishore Biyani, promoter of Future Group, had then told BusinessLine: “If a country like Thailand has 11,000 7-Eleven stores, Mumbai can easily have 1,000 stores.” He had plans to launch the first 7-Eleven store in Mumbai around February-March in 2020.

However, even before it could take off, Future 7-India Convenience Limited, which owned the master franchisee of 7-Eleven, reported a net loss of ₹9.61 crore in FY20, according to the company’s annual report.

The Covid-19 pandemic delayed its plans even as Future Retail was struggling with its huge debt. Last year, Biyani decided to sell off the assets of the retail and wholesale businesses to Reliance Industries for ₹24,713 crore.

This is being opposed by Amazon who had invested ₹1,400 crore in Future Coupons Private Limited in 2019.

Published on October 05, 2021

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