Udayavni Special

Amazon had asked for $40mn as compensation for RIL deal: Future Group


PTI, Feb 16, 2021, 10:55 AM IST

New Delhi: Amazon had asked for $40 million (around Rs 290.41 crore) in compensation from Future Group for the deal with Reliance Industries, and Amazon’s claim of not being informed of the deal is incorrect, documents submitted to the emergency arbitrator of SIAC by the Kishore Biyani-led firm said.

According to the submission by Future Group in October last year, Amazon was well aware of Future’s Rs 24,713 crore deal with RIL.

“In August 2020, two phone calls among the 3rd respondent (Kishore Biyani) and 8th respondent (Rakesh Biyani) and Abhijit Mujumdar on behalf of the claimant (Amazon.com NV Investment Holdings LLC), the claimant asked for $40 million as compensation in exchange for the Future Group and Reliance proceedings with the disputed transaction,” the document said.

It further stated that “the claimant’s contention in the NOA and the application that it did not have any information in connection with the disputed transaction is incorrect”.

The document – dated October 12, 2020 – also noted Future Retail had made a public announcement on August 29, 2020, about the deal “after having informed the claimant’s representatives that discussions were ongoing with Reliance”.

“So, leaving aside the messages, calls and e-mails referred… the claimant was aware of the disputed transaction for more than a month before it initiated the present arbitration proceedings,” Future said in its submission, a copy of which was seen by PTI.

Amazon did not respond to e-mailed queries seeking comments on the matter.

On August 29, 2020, Future Group had announced that its retail and wholesale business would be sold to Reliance Retail, owned by oil-to-chemical conglomerate RIL in a Rs 24,713 crore deal.

In October 2020, Amazon had dragged Future Group to arbitration at Singapore International Arbitration Centre (SIAC), arguing that Future violated the contract by entering into the deal with rival Reliance.

On October 25, 2020, an interim award was passed in favour of Amazon with a single-judge bench of V K Rajah barring Future Retail from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.

In August 2019, Amazon had agreed to purchase 49 per cent of one of Future’s unlisted firms, Future Coupons Ltd (which owns 7.3 per cent equity in BSE-listed Future Retail through convertible warrants), with the right to buy into the flagship Future Retail after a period of three to 10 years.

Even after the interim award, Amazon and Future Group remain locked in a legal tussle in the matter. Both parties have approached several legal forums.

On the other hand, the Future-Reliance deal has already received clearance from CCI, SEBI and bourses, and the scheme of arrangement is now awaiting the nod from the National Company Law Tribunal (NCLT) and shareholders.

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