Amazon has written to India’s markets regulator SEBI asking it to withdraw its conditional approval to the Rs 24,713 crore deal between Reliance and the Future Group as the e-commerce major looks to up the ante in its tussle with Reliance over the deal..
In a letter to Sebi chairman Ajay Tyagi, dated August 17, the e-commerce company relied on a recent ruling by the Supreme Court which ruled in favour of Amazon and against the deal.
While upholding an October 2020 decision of a Singapore-based Emergency Arbitrator, India’s top court said that Reliance cannot go ahead with its deal with the Future Group.
“In light of the directions contained in the enforcement judgment, and the EA (emergency arbitration) Order whose validity has been affirmed by the honourable Supreme Court, Amazon requests you to take all such action as is necessary to comply with the Supreme Court Judgment,” Amazon told Sebi in its four-page letter and a copy seen by Entrackr.
The markets regulator had given the deal between Reliance and Future Group a conditional approval in January this year. Amazon’s letter added that the approval from stock exchanges “were conditional on the outcome of the ongoing proceedings”.
Amazon declined to comment and Future Group did not respond to our queries until publication.
What’s at stake?
This marks yet another chapter in what has become a hotly contested battle between the three companies.
In August 2020, Reliance announced that it was buying Future Group’s retail business and as part of the deal, would take over 1,800 stores of Big Bazaar, EasyDay, FBB and Food Hall to spread its retail footprint across the country. The firm was also taking over Rs 19,000 crore of debt and liabilities of the Future Group as part of the deal.
However, Amazon claimed that the deal was against a contract that it had signed with the Future Group, referring to a non-compete clause in its transaction with Future Coupons which barred it from any deal with 30 companies, including Reliance Industries.
Not the end of the battle
While India’s top court has, for now, ruled in favour of Amazon, the battle is far from over.
Last week, the Future Group filed a fresh case against Amazon at the Supreme Court in a bid to get the deal approved, claiming that should the deal fall through, it would put bank loans at risk, as per a Reuters report.