SUMMARY
The deal between Reliance and Future Group would only go through if Future Group’s subsidiaries are merged into one entity
Future Group had earlier submitted a petition in Delhi high court for an interim injunction restraining Amazon’s interference in the Reliance-Future Group deal
The Delhi HC had recently rejected Future Retail’s plea to stop Amazon from writing to SEBI, CCI and stock exchanges about the deal
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The never-ending tussle between Amazon, Reliance Retail and Future Group continues with the US tech giant now urging the Securities and Exchange Board of India (SEBI) to not approve the merger of Future Group subsidiaries, which is a critical step in the deal.
As per the terms of agreement between Reliance and Future, the deal between the two companies would only go through if Future Group’s companies are merged into one entity. However, Amazon had gone to the Singapore International Arbitration Court (SIAC) to block the deal, given that Amazon has a stake in one of the subsidiaries.
In another attempt to pause the deal, Amazon has written to SEBI asking it to not to give a go-ahead to Future Group mergers as the SIAC’s order is valid under India’s arbitration law. Last week, the Delhi high court had allowed Amazon to write to market regulators and stock exchanges in relation to the deal, following a petition by Future Group against it.
The court had also noted that the Future-Reliance deal was in full accordance with the law and the deal between Amazon and Future Retail was in the nature of control and therefore it required government approval.
According to a Mint report, the Amazon letter said, “The Delhi high court has also made it clear that no observations were passed with respect to the merits of the interim award. Consequently, all findings contained in the interim award, including the finding that FRL (Future Retail Ltd) is a necessary and proper party to the arbitration proceedings, continue to be valid.”
Amazon is reportedly looking to approach either a divisional bench of the high court or the national company law tribunal (NCLT) to block the deal.
The battle between Amazon and Future Group began when Reliance Retail acquired a 30% stake in the retail, wholesale, logistics, and warehousing businesses of the Future Group for INR 24K Cr in August.
The deal was complicated by the fact that last year, Amazon had acquired a 49% stake in the promoter-entity of Future Retail called Future Coupon for around INR 1,500 Cr and according to the shareholders’ agreement, Amazon had barred Future Coupon from selling its assets to 15 companies, including Reliance Retail.
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