Future-Ril deal: Amazon gets a temporary favourable ruling in Emergency Arbitration
Amazon gets an interim relief in the Future-Ril deal dispute in the emergency arbitration preceding conducted in Singapore. The order to Tribunal will be valid for 90 days. Te main Tribunal will be formed and the issue of interim orders can be taken within 90days. Kishore Biyani’s Future Group and Mukesh Ambani’s Reliance has to hold their deal for some time again as the Singapore International Arbitration Centre(SIAC) has granted temporary relief to Jeff Bezos’ Amazon.
Earlier this month, Amazon had approached the SIAC over it’s dispute with Future Coupons, the promoter firm of the Future Retail, where the Future Group agreed to sell it’s entire businesses to Reliance Retail Ventures Limited(RRVL), a subsidiary of Reliance Industries, for INR 24713 Crores($3.3 Billion) and also being rescued from a debt of almost INR 19,000 Crores($2.6 Billion) in August,2020.
In 2019, Amazon had invested about INR 2000 Crores ($272 Million) in the Future Coupons and had acquired 49 percent stake in it and 3.6 percent stake in the Future Group. Amazon claimed that the acquisition of Future Group by the Reliance Retail is a violation of a non-compete clause and a right-of-first-refusal pact it had signed with the Future Group in 2019.
While the Future-Ril merge is put on a hold by the interim order, the matter will continue to be held at SIAC before the sole arbitrator, VK Rajah, the former Attorney General of Singapore. The court order said, “The majority respondents (Future Group) have asserted that the “horse has bolted" and that, consequently, the claimant no longer has any legitimate interests meriting protection. This is incorrect. The horse has not bolted, even though the respondents have opened the stable door. Even assuming that the “horse has bolted", it is apparent that the respondents are contractually obliged to work with the claimant to cajole the “unruly horse" to return to its stable”.
The Amazon spokesperson said, “We welcome the award of the Emergency Arbitrator. 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.”
However, Reliance Retail, in a statement, said that the decision is not enforceable in India and it tends to enforce its rights and complete the transaction in terms of scheme and agreement without any delay.
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