Shares of Reliance Industries fell a whopping 2.54 percent, hitting an intraday low of Rs 2,079 on the BSE after the Supreme Court on Friday said Reliance Retail had closed its $3.4 billion deal to buy retail assets from Future Groups. cannot continue. In a big win for Amazon, the Supreme Court today said Reliance cannot proceed with its $3.4 billion deal to buy retail assets from Future Groups. The court backed the arbitrators’ decision to suspend the deal in the legal battle between Jeff Bezos and Mukesh Ambani.
Amazon had taken its partner Future Group to court, alleging it had breached contracts by agreeing to sell retail assets to market leader Reliance Industries for Rs 24,731 crore last year.
Amazon and Future are engaged in a legal battle over the Future Group deal, with the US company accusing the Future Group of violating pre-existing contracts when it sold its assets to Reliance. Future has denied all allegations.
A two-judge bench of the Supreme Court said an interim decision by a Singaporean arbitrator in October — who put the deal on hold after Amazon’s objections were upheld — was valid and enforceable in India.
Amazon had argued that the order is binding, while Future had argued that it was not. Both parties had agreed to use the Singaporean arbitrator in case of disputes when Amazon invested $200 million in a unit of Future in 2019. The arbitration procedure is still ongoing.
Future Retail shares were locked in a 10 percent lower circuit at Rs 52.55 after the court ruling.
Future, India’s second largest retailer with more than 1,700 stores, has said it will be liquidated if the deal with Reliance falls through.
At 12:58 PM, Reliance Industries shares had fallen 1.98 percent to Rs 2,091, underperforming the Sensex, which fell 0.28 percent.