Amazon Approaches Supreme Court To Halt Future-Reliance Deal
In a last ditch attempt, Amazon has knocked the Supreme Court after a Delhi High Court bench lifted a stay on the deal imposed earlier by HC's single judge
Amazon approached the Supreme Court of India (SC) on 11 February 2021 wherein it has sought to halt Future Group's $3.4 billion retail assets sale to Reliance Industries after a Delhi High Court (HC) interim order that revoked a single Judge's decision that effectively blocked the deal.
Future Group is India's second-largest retailer with over 1,700 stores. It was mentioned by Future that it will be pushed towards liquidation if the deal falls through.
The dispute arose between the parties based on Future's decision to sell its retail, wholesale and some other businesses to Reliance for $3.38 billion, including debt.
It was argued on behalf of Amazon that it had a separate deal with a Future unit that contained a clause stating that the Indian group couldn't sell its retail assets to a list of companies, including Reliance.
The HC in its order allowed the pending procedures before the National Company Law Tribunal (NCLAT) as the Competition Commission of India (CCI) and the Securities and Exchange Board of India (SEBI) has already approved the deal. It was opposed by Amazon and it stated that once the matter goes through the regulatory bodies then there is no scope of returning.
Amazon approached the Top Court against the said order of the HC wherein it mentioned in its petition that the HC bench should have waited for a detailed order of the Single Judge of the HC before passing an order of removal on hold of the deal.
It was further alleged by Amazon that Future Group had violated contracts by agreeing to sell its retail assets to Reliance Industries last year. However, the said allegation was denied by the Future Group.
It was further claimed by Amazon that a decision passed by an arbitrator in Singapore in October 2020 wherein the Future-Reliance deal was blocked is enforceable under Indian laws.
The HC had noted that Future Retail was not a party to the arbitration agreement with Amazon and so the 'group of companies' doctrine was not applicable. A 'group of companies' doctrine refers to a situation when a deal signed by one firm in a group is also understood to include other firms in the group that has not signed the contract.
Amazon stated in the petition that the previous order of the Single Judge of the HC wherein it had put the deal on hold was for protecting the interests of all parties till a decision was made on the dispute. The retail giant owned by Jeff Bezos said once Future and Reliance move ahead with a transaction, it would be difficult to undo it.