Amazon has written to SEBI requesting the regulator to direct stock exchanges to withdraw the ‘Observation Letters’ that were issued related to the proposed ₹24,713-crore Future-Reliance deal.
The U.S. e-commerce giant has also urged SEBI to take necessary action to comply with the recent Supreme Court judgment related to the deal.
“In light of the directions contained in the Enforcement Judgment, and the EA Order whose validity has been affirmed by the Hon’ble Supreme Court, Amazon requests you to take all such action as is necessary to comply with the Supreme Court Judgment, and to further ensure that no communications subsist or emanate which are at variance with the Supreme Court Judgment,” Amazon wrote in a letter dated August 17, referring to the SC ruling on the order of the Singapore-based Emergency Arbitrator (EA). In January, SEBI had cleared the deal with riders.
Thus, the arbitration order can be enforced under the provisions of Section 17(2) of the Act.
The letter -- a copy of which was seen by PTI -- further said: “...we request your good offices to direct the Indian Stock Exchanges to withdraw the Observation Letters with immediate effect.” Amazon declined to comment on the matter, while e-mails sent to Future Group did not elicit any response.
In January this year, Sebi had given its go-ahead to Future Group’s scheme of arrangement and sale of assets to Reliance with some riders, based on which the BSE granted its “no adverse observation” report for the Rs 24,713-crore deal. The stock exchange, in its observation letter dated January 20, 2021, had said it has “no adverse observations with limited reference to those matters having a bearing on listing/de-listing/continuous listing requirements within the provisions of Listing Agreement, so as to enable the company (Future) to file the scheme with Hon’ble NCLT (National Company Law Tribunal).” In August last year, Reliance Retail Ventures Ltd (RRVL) had said it will acquire the retail and wholesale business, and the logistics and warehousing business of Future Group for Rs 24,713 crore.
The scheme of arrangement entails the consolidation of Future Group’s retail and wholesale assets into one entity Future Enterprises Ltd and then transferring it to Reliance Retail.
The deal has been contested by Amazon, an investor in Future Coupons that in turn is a shareholder in Future Retail Ltd.
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 Ltd through convertible warrants), with the right to buy into the flagship Future Retail after a period of three to 10 years.
Amazon had dragged Future into arbitration at SIAC (Singapore International Arbitration Centre).
In October, an interim award was passed by the EA in favour of the US-e-commerce major that barred 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.
Amazon and Future Group had also filed litigations in Indian courts, including the Supreme Court, on the issue. Earlier this month, the apex court ruled in favour of Amazon by holding that the EA award was valid and enforceable under Indian laws.
Notably, Kishore Biyani-led Future Retail Ltd had on August 28, 2021 said it has approached the Supreme Court against an order passed by the Delhi High Court to maintain status quo in relation to the deal and directing it to enforce the order of the Singapore-based Emergency Arbitrator.
