Amazon gets interim win against Reliance-Future’s $3.4 bn deal

A Singapore arbitration panel has put on hold Future Group’s $3.38 billion asset sale to Reliance Industries (RIL), an interim win for Amazon.com, which had alleged the deal between the Indian firms breached existing agreements, Reuters reported.
Amazon.com India jobsAmazon.com received an emergency order to halt the companies from proceeding with the deal until an arbitration tribunal is formed.

Amazon last year bought 49 percent stake in Future Coupons, which owns 7.3 percent stake in Future Retail. In August, Mukesh Ambani’s Reliance Industries decided to buy retail, wholesale and some other businesses of Future Group in a deal valued at $3.38 billion, including debt.

But Amazon’s investment came with contractual rights that include a right of first refusal and a non-compete-like pact. Amazon later started arbitration proceedings in Singapore.

“It’s a comprehensive victory for Amazon,” a source with direct knowledge of the decision said. “They’ve won an injunction to stop the deal.”

The temporary injunction was not automatically enforceable in India and that the order would have to be ratified by an Indian court.

In a statement, Amazon said: “We are grateful for the order which grants all the reliefs that were sought. We remain committed to an expeditious conclusion of the arbitration process.”

Reliance Retail intends to complete the transaction under the terms of the agreement with Future Group without any delay, Reliance Retail Ventures (RRVL) said in a statement on Sunday.

“RRVL has entered into the transaction for acquisition of assets and business of Future Retail Limited under proper legal advice and the rights and obligations are fully enforceable under Indian Law,” the statement added.