Amazon’s challenge to Future Group’s $3.4 billion deal with Reliance Industries will mark a Supreme Court ruling today, ending one of the most bitter battles in the world’s only multi-billion-plus retail market open to foreign competition.
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Amazon had sued partner Future Group for violating contracts by agreeing to sell retail assets to market leader Reliance Industries for more than Rs 27,000 crore last year. Future denies any wrongdoing.
Last week, the Supreme Court reserved its verdict in the case and will rule on whether a Singapore tribunal ruling banning Future from going through with the merger with Reliance is valid.
A New Delhi court dealt a blow to the US company in February by overturning a previous court decision that effectively blocked the deal, and Amazon filed an appeal to the Supreme Court shortly after.
Amazon said in its court that the Delhi court’s order was “illegal” and “arbitrary” and that the company that made $6.5 billion in investments in India would face “irreparable damage” if the highest court does not intervene would come.
The legal battle over Future’s assets has embroiled two of the world’s richest men – Amazon’s Jeff Bezos and Reliance’s Mukesh Ambani. The final result will be seen as the pandemic-affected retail sector in India takes shape and will determine whether Amazon can dent Reliance’s dominance.
Amazon has argued that a 2019 deal with a Futures unit contained clauses stating that the Indian group could not sell its retail assets to anyone on a “restricted person” list, including Reliance.
The US company had invested in Future Group in 2019 and acquired a 49 percent stake in Future Coupons Ltd, which has 9.82 percent in Future Retail.
Future, India’s second largest retailer with more than 1,700 stores, has said it will be liquidated if the deal falls through.
Meanwhile, India’s antitrust regulator has accused Amazon of concealing facts and making false statements when it sought approval for the 2019 investment in the Future Group unit, Reuters news agency reported last month.
The letter from the Competition Commission of India (CCI), dated June 4, could complicate the legal battle for Amazon, even if the Supreme Court rules in its favor for the time being.