Amazon wins arbitration order against Future's deal with Reliance

Future Consumer

25/10/2020 16:51

NEW DELHI/MUMBAI, Oct 25 (Reuters) - A Singapore arbitration
panel has put on hold Future Group's $3.38 billion asset sale to
Reliance Industries  RELI.NS , an interim win for Amazon.com Inc
 AMZN.O  which had alleged the deal between the Indian firms
breached some existing agreements.
    Amazon received an emergency order to halt the companies
from proceeding with the deal until an arbitration tribunal is
formed, a source with direct knowledge of the matter told
Reuters.
    Amazon last year bought a 49% stake in Future Coupons Ltd,
which owns a 7.3% stake in Future Retail. In August, Mukesh
Ambani's Reliance decided to buy retail, wholesale and some
other businesses of the Future Group in a deal valued at $3.38
billion, including debt.  urn:newsml:reuters.com:*:nL4N2FV067
    But Amazon's investment came with contractual rights that
include a right of first refusal and a non-compete-like pact, 
media had reported, and Amazon later started arbitration
proceedings in Singapore.  urn:newsml:reuters.com:*:nL3N2EZ2CG urn:newsml:reuters.com:*:nL4N25J149
    "It's a comprehensive victory for Amazon," a source with
direct knowledge of the decision said. "They've won an
injunction to stop the deal." 
    Two sources familiar with the matter said that the temporary
injunction was not automatically enforceable in India and that
the order would have to be ratified by an Indian court.
    In a statement, Amazon said it welcomed 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," Amazon added.
    Future Group and Reliance were not immediately reachable for
comment.

 (Reporting by Aditya Kalra and Euan Rocha; Writing by Ann Maria
Shibu in Bengaluru; Editing by Nick Macfie)
 ((AnnMaria.Shibu@thomsonreuters.com; +1 646 223 8780;  + 91 80
6749 2795;))