Amidst the ongoing legal tussle between Reliance and Amazon over Future Retail deal, the Competition Commission of India or CCI has given the approval to the Mukesh Ambani-led firm to acquire Future Group’s retail, wholesale, logistics and warehousing businesses.
“Commission approves acquisition of retail, wholesale, logistics & warehousing businesses of Future Group by Reliance Retail Ventures Limited and Reliance Retail and Fashion Lifestyle Limited,” the competition watchdog wrote on Twitter.
The approval from CCI could be a major setback for Amazon which holds a minority stake in Future Coupons, a promoter company of Future Retail. Expecting relief, the company had made an appeal to CCI, but the commission didn’t see merits in the company’s claims and gave a nod for the deal.
On August 29, Reliance had announced the acquisition of businesses of Kishore Biyani’s Future Group for Rs 24,713 crore or $3.4 billion. Amazon, an investor in one of Future’s holding companies, has been referring to a non-compete clause that bars Future Group from striking any deal with 30 companies including Reliance Industries Limited without its approval.
On the basis of the clause, Singapore International Arbitration Centre (SIAC) gave relief to the e-commerce giant and granted injunction against the acquisition.
According to Amazon, Future group had breached certain contract provisions it entered into last year. To consider the arbitration order and stop the deal, Amazon had also approached market regulator Securities and Exchange Board of India (Sebi) and stock exchanges.
Future Group, on the other side, had filed a suit in Delhi High Court to oppose Amazon from approaching Indian regulatory authorities with the interim order of SIAC. During the hearing of the case, Future Group’s lawyers argued that the SIAC order was not binding and enforceable in India. According to them, Future Retail does not have any contractual rights with Amazon, hence it does not require to seek permission from the e-commerce major for any investments.