after Amazon's objection, says report
2 min read . 03:16 PM ISTAbhirup Roy and Aditya Kalra , Reuters
Amazon on 25 October won an injunction from a Singapore arbitrator to halt Future's deal to sell retail assets to Reliance
A BSE source said it will consult SEBI about its stance on the deal and the exchange later on Friday
The Bombay Stock Exchange (BSE) will consult the market regulator and seek clarifications from Future Retail and Reliance Industries about their $3.4 billion transaction, following Amazon's objection to the deal, an exchange source said.
Amazon on 25 October won an injunction from a Singapore arbitrator to halt Future's deal to sell retail assets to Reliance, arguing the Indian retailer group breached certain contract provisions it entered into last year in a separate deal with the US firm.
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This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.
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Now has learnt that Amazon has won the first round of the legal battle to stop Future Retail’s Rs25,000 odd cr sale to Mukesh Ambani’s Reliance Retail. Amazon has got a favourable interim ruling from the sole arbitrator in Singapore.
Confirming this, an Amazon spokesperson said: “We welcome the award of the Emergency Arbitrator. We are grateful for the order which grants all the reliefs that were sought. We remain committed to an expeditious conclusion of the arbitration process.”
Amazon was represented by the following counsel:
• Gopal Subramanium, QC, Senior Counsel; Gourab Banerji, QC, Senior Counsel; Amit Sibal, Senior Counsel; Alvin Yeo, Senior Counsel.
• AZB& Partners; P&A Law Offices; WongPartnership LLP.
ET Now was the first to report that Amazon has sent a legal notice to Future Coupons alleging violation of contractual obligations by announcing a deal with Reliance Retail. Sources had said as per a non-compete pact between Future Coupons and Amazon, the former could not sell to RIL as its name was specifically mentioned in a “restricted list”
Future Group’s Kishore Biyani had recently said there was no choice but to sell to Reliance because of debt piling up. The Future Group has sent over Rs 12,000 Crrores. Around a year ago, Amazon had bought a 49% stake in Future Coupons, the promote entity of Future Grou
Amazon gets interim relief; arbitration panel says Future cannot sell business to RIL for ₹24,713 cr
'We welcome the award of the Emergency Arbitrator. We are grateful for the order which grants all the reliefs that were sought,' says Amazon
Future Retail Latest News | #Future_Retail_Latest_News
This is the crux of the stand taken by Amazon at the hearing held by former Attorney-General of Singapore VK Rajah, the sole arbitrator looking into the dispute between the American retail giant and the Future Group over the latter’s ₹25,000-crore deal with RIL.
At a hearing that lasted five hours, Amazon hinged its argument on alleged contract breach. In 2019, due to the FDI restrictions in the e-commerce sector, Amazon could not have invested in Future Retail; hence, it invested ₹1,430 crore in FCPL. “If the deal between RIL and Future Retail is to happen, then Amazon’s investment goes waste as it will not get any returns,” said a source.
On the other hand, Future Retail informed the arbitrator the deal between Future Retail and RIL did not breach any contract because Amazon’s agreement is with FCPL, which is a separate entity. Of the five board seats of Future Retail, the promoters have only two. Hence, it was a not a decision by the promoters alone, it said.
A ‘suitable’ partner
But a source close to Amazon said: “In May, before the deal with RIL was announced, Amazon was informally helping Future Retail find a suitable partner. It had even recommended Premji Invest to Biyani’s company. However, the Future Group decided to go ahead with the RIL deal, which is a breach of contract and anti-shareholder on multiple grounds.”
Singapore-based lawyer Davinder Singh appeared on behalf of Future Cuopons, the holding company of Kishore Biyani. Gopal Subramanium, former Solicitor-General of India, appeared for Amazon. P&A Law Firm, Naik & Naik Associates and AZB Associates have also been roped in for advice.
The arbitrator is expected to give his verdict as is understood to have approached its lenders to restructure its debt under the new scheme announced by the RBI. A delay in closing the deal with RIL would leave the Future Group in severe financial crisis. Biyani would be the biggest loser in this battle between Jeff Bezos and Mukesh Ambani.