38.6c New Delhi, India, Monday, July 15, 2024

The Future Group Asked to Put a Hold on Deals Made with Reliance till the Dispute Between Amazon and the Former is resolved

By VANDANA KOTHARI      27 October, 2020 06:24 PM      0 Comments
The Future Group Asked to Put a Hold on Deals Made with Reliance till the Dispute Between Amazon and the Former is resolved

The arbitration proceedings between Amazon and Kishore Biyani-headed FutureGroup took place last week in Singapore at the Singapore International Arbitration Centre. The matter was heard by former Singapore Attorney-General V K Rajah as an emergency arbitrator on October 16. 

The case started when Amazon sent a legal notice to Future, alleging the retailer’s Rs 24,713-crore asset sale to Reliance Industries Ltd breached an agreement with the American e-commerce giant.

The case was that in 2019, Amazon made a deal with Future Retail worth Rs 2000 crore to acquire a 49 percent stake in the promoter firm of Future Retail i.e., Future Coupons. The said deal had few conditions including a “non-compete” clause and “right of first refusal” (RoFR) clause, which meant Future could not sell its shares without approval from Amazon. The RoFR gave Amazon the right to be the first to invest in Future Retail if Future decided to sell its shares. But there is another clause that mentioned that the Future could not sell its assets without Amazon’s approval.

On August 29, 2020, the Future announced its deal with Reliance in which it announced the sale of its retail, wholesale and logistics, etc to Reliance Retail Ventures Ltd (“RRVL"), the retail arm of RIL.

On this deal, Amazon approached the Tribunal for interim relief under Rule 30 of Singapore International Arbitration Centre Rules, 2016, and alleged that Future Group violated the contract by entering into the deal with rival Reliance.

Amazon was represented by Gopal Subramanium, Gourab Banerji, Amit Sibal, Alvin Yeo, Amit Mishra from P&A, Anand Pathak, VP Singh, and RachitBahl from AZB assisted by Pawan Bhushan, Hima Lawrence, and UjwalaUppaluri. While Future Retail was represented by advocate Harish Salve, Davinder Singh, Trilegal, and Naik & Naik. 

The Future group contended that it was only selling assets to the Reliance and not its Share therefore they have not violated any conditions of the deal. 

Future Group's Board Resolution of Aug 29 said that Future Enterprises was to "sell by way of a slump sale the retail and wholesale business that includes key formats such as Big Bazaar, fbb, Foodhall, Easyday, Nilgiris, Central and Brand Factory to Reliance Retail and Fashion Lifestyle Limited (RRFLL), a wholly-owned subsidiary of Reliance Retail Ventures Limited (RRVL). It will also sell the logistics and warehouse business to RRVL by way of a slump sale. RRFLL and RRVL will take over certain borrowings and current liabilities related to the business and discharge the balance consideration by way of cash."

On Sunday 25th October, Amazon got interim relief by the Emergency Arbitrator against the Future Group who were asked to put the deal on hold and that the deal cannot go through until it finally decides the matter. 

The Amazon spokesperson while confirming the award said that "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."

Reliance Retail Ventures Limited(RRVL) on this step said that it has been informed about the interim order passed and "RRVL intends to enforce its rights and complete the transaction in terms of the scheme and agreement with Future group without any delay,"

The Future Group has also been injuncted from filing or pursuing any application before any Body or Agency in India with respect to the said Board Resolution.

Share this article:

Leave a feedback about this

Trending Judiciary
CIC has powers to set up benches: SC [Read Judgement]

The Supreme Court affirms CIC's authority to set up benches, emphasizing its autonomy for efficient case management under the RTI Act, overturning the 2010 Delhi HC order.

15 July, 2024 09:42 AM


Trending Crime, Police And Law
Journalist Soumya Vishwanathan murder case: SC issues notice to 4 convicts on appeal by Delhi police

SC issues notice to 4 convicts in Soumya Vishwanathan murder case on Delhi police's appeal against their bail. Convicts had served over 14 years.

09 July, 2024 09:49 AM
Trending Judiciary
Why Indian High Courts still have old names despite change in city name ? [Watch Video]

Know the reasons why Indian High Courts, like Bombay HC, Madras HC, and Calcutta HC, Allahabad HC still retain their old names despite the cities’ name changes. LawStreet Journal delves into the historical and legal context. Watch report !

09 July, 2024 09:56 AM
Trending International
What is Keir Starmer’s stance on Kashmir issue ? [Watch Video]

Under Keir Starmer, the UK's Labour Party shifts its stance on Article 370, focusing on strategic ties with India, moving from past criticisms to cooperation.

09 July, 2024 10:04 AM
Trending Judiciary
ED moves SC against Jharkhand HC order of bail to CM Hemant Soren

ED moves SC against Jharkhand HC's bail order for CM Hemant Soren in a money laundering case linked to an alleged land scam.

09 July, 2024 12:14 PM


Join Group

Signup for Our Newsletter

Get Exclusive access to members only content by email