Future Retail To Amazon: Stop Meddling In $3.4B Asset Sale
Future Retail is attempting to prevent partner Amazon from meddling further in its $3.4 billion asset sale deal with Reliance Industries and has challenged the U.S. eCommerce giant in a New Delhi court, Reuters reported.
Amazon is currently in a legal dispute with the Indian powerhouse, which recently sold its assets to Mukesh Ambani’s Reliance Industries in what Amazon contends is a violation of Future’s deal with it earlier this year.
Last month, Amazon won an injunction to the courts to prevent the deal from going forward. But Future said that order is non-binding. Now, Reuters reported Amazon is lodging a complaint with India’s market regulator.
On Saturday (Nov. 7), the Delhi High Court was asked to stop Amazon from “misusing” the arbitration to interfere with the deal with Reliance. Other details about Future’s challenge weren’t disclosed, although Reuters reported that the filing said all entities taking part in the arbitration proceeding were made part of the suit, although only Amazon is being held liable.
Amazon said the 2019 deal for $200 million, invested in a Future unit in the hopes of getting further ingrained in India’s eCommerce market down the line, came with clauses that the Indian group wasn’t allowed to sell its assets to other companies on a “restricted persons” list that included Reliance. The whole controversy has likely damaged Amazon’s ties with Ambani, who is Asia’s richest man, and the Reliance group, fast spreading in the region as a leader in eCommerce.
Reliance’s growing footprint includes a $750 million investment from the Abu Dhabi Investment Authority (ADIA), which will give the sovereign wealth fund a 1.2 percent stake in Reliance Retail. An announcement from ADIA touted Reliance Retail’s footprint in serving almost 640 million customers via its 12,000 stores in the country.