Amazon moves apex court in Future-reliance deal dispute
The development comes after a recent Delhi HC ruling that stayed a previous order on status quo
NEW DELHI: E-commerce major Amazon has moved the Supreme Court in a bid to block Future group’s ₹24,713-crore deal with Reliance, according to people familiar with the matter.
The development comes after a recent Delhi high court ruling that stayed a previous order on status quo of the deal and ruling that statutory authorities cannot be restrained from acting in accordance with law.
The Delhi high court observed that Future Retail is not a party to the arbitration agreement between Amazon and Future Coupons Pvt. Ltd.
Amazon has approached the Supreme court in the matter against Future, people close to the development said.
Future and Amazon did not respond to e-mailed queries.
The high court order on Monday came over an urgent petition moved by FRL after a single-member bench directed maintaining status-quo over Future’s deal with Reliance.
The scheme of arrangement has already received approval from Competition Commission of India and no objection from Securities and Exchange Board of India (Sebi) and bourses, following which it had approached National Company Law Tribunal
(NCLT) Mumbai on January 26, 2021.
Last month, Amazon had approached the Delhi high court seeking enforcement of the interim order of the Emergency Arbitrator (EA) at the Singapore International Arbitration Centre (SIAC) that had restrained FRL from going ahead with the deal with Reliance.
Justice Midha had directed FRL and other parties to maintain status quo till pronouncement of the reserved order.
Amazon and Future have been locked in a bitter legal tussle after the US e-commerce giant dragged Future Group to arbitration at SIAC, arguing that the latter had violated their contract by entering into the deal with rival Reliance.
In its petition, Amazon alleged that the ₹24,713 crore deal with Reliance Industries violates its investment agreement with Future Group that barred the company from selling its assets to Mukesh Ambani’s conglomerate among other specified entities.
Amazon had invested in Future Coupons in August 2019, with an option of buying into the flagship Future Retail after a period of three to 10 years.
Kishore Biyani’s Future Group, which needs to complete the deal without delay to prevent a possible bankruptcy, has been caught in the fight between two of the world’s wealthiest men. At stake is control of India’s retail market, estimated to reach $1.3 trillion by 2025, amid a surge in online shopping. Amazon and Walmart-owned Flipkart together control over 80% of the Indian e-commerce market and have been competing to make inroads into the traditional retail market in India.
In August last year, Future group had entered into a deal with billionaire Mukesh Ambani’s RIL to sell its retail, wholesale, logistics and warehousing units in a ₹24,713-crore deal. On October 25, 2020, an interim award was passed in favour of Amazon with a singlejudge bench of V K Rajah barring Future Retail from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.
AMAZON ALLEGES THAT THE DEAL WITH RIL VIOLATES ITS INVESTMENT AGREEMENT WITH FUTURE GROUP