New Delhi: Amazon’s challenge against Future Group’s $3.4 billion deal with Reliance Industries will see a Supreme Court ruling today, concluding one of the most bitterly fought battles in the world’s only billion-plus retail market open to foreign competition.
Here is your 10-point guide to this big story:
- Amazon had taken partner Future Group to court saying it violated contracts by agreeing to sell retail assets to market leader Reliance Industries last year for over Rs 27,000 crore. Future denies any wrongdoing.
- Last week, the Supreme Court reserved its judgement in the case and is set to decide whether a ruling by a Singapore tribunal restraining Future from going ahead with its merger with Reliance is valid.
- A New Delhi court in February had dealt a blow to the US firm by revoking a previous court decision that effectively blocked the deal, and Amazon filed an appeal against it in the Supreme Court soon after.
- Amazon said in its court filing the order by the Delhi court was “illegal” and “arbitrary” and the company which has committed $6.5 billion in investments in India would face “irreparable harm” if the top court did not intervene.
- The legal fight over Future’s assets has embroiled two of the world’s richest men – Amazon’s Jeff Bezos and Reliance’s Mukesh Ambani. The final outcome will be seen shaping India’s pandemic-hit shopping sector and will determine if Amazon is able to dent the dominance of Reliance.
- Amazon has argued that a 2019 deal it had with a Future unit included clauses saying the Indian group couldn’t sell its retail assets to anyone on a “restricted persons” list, including Reliance.
- The US company had invested in Future Group in 2019, acquiring a 49 per cent stake in Future Coupons Ltd, which holds 9.82 per cent in Future Retail.
- Future, India’s second-largest retailer with over 1,700 stores, has said it will be pushed towards liquidation if the deal falls through.
- Meanwhile, India’s antitrust regulator has accused Amazon of concealing facts and making false submissions when it sought approval for the 2019 investment in the Future Group unit, news agency Reuters reported last month.
- The Competition Commission of India (CCI) letter, dated June 4, could complicate the legal battle for Amazon even if the Supreme Court rules in its favour for now.