The Supreme Court issued its ruling in favour of Amazon on August 6 in the Amazon-filed case against Future Group's 3.4 billion dollar deal with Reliance Industries. The apex court had earlier reserved its judgement in the case where Amazon contested the validity of Future's merger with Reliance.
The court's decision stipulated that Reliance cannot buy Future Group's retail assets with its 3.4 billion dollar deal. In October 2020, the Singapore Emergency Arbitrator had restricted Future Retail from merging with Reliance Retail, a directive the Supreme Court now issued as valid. The Singapore arbitrator is yet to announce a final decision.
Amazon filed a case against partner Future Group for selling retail assets to Reliance industries, claiming violation of contracts, while the latter denied allegations of wrongdoing. Amazon, however, claimed that in its 2019 deal with Future Group, contracts stipulated that Future could not sell its retail assets to anyone on the 'restricted person list', a list that includes Reliance.
A Delhi High Court division bench put the single judge order that blocked the deal on hold, after which Amazon approached the apex court. Amazon also claimed in its court filing that the Delhi High Court's decision was "illegal" and "arbitrary", reported NDTV.
The e-commerce giant owns a 49% stake in Future Coupons Ltd, which accrues to a 9.82% share in Future Retail.
Kishore Biyani, CEO of Future Group, and other shareholders of the company were asked to submit affidavits and details of their assets in March by a single-judge bench while being asked why they shouldn't be detained for violation of the Singapore Arbitrator's order.
Future had earlier contested that the company will be forced to liquidate if the deal with Reliance falls through. Following the Supreme Court's ruling in favour of Amazon, Future Enterprises' and Future Lifestyle's share prices went down 10% each, while Reliance Industries' stock price fell by more than 2%, reported Financial Express.
Additionally, the Competition Commission of India accused Amazon of making false statements and concealing facts to receive approval for its investment in Future Group in 2019 in a letter issued on June 4, 2020. While the Supreme Court has already ruled in Amazon's favour, the CCI's accusations might result in further legal battles for Amazon.