Amazon wins arbitration order against Future's deal with Reliance (updated)

Future Consumer

25/10/2020 21:59

(Adds Reliance Retail statement)
    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 Ltd  RELI.NS , an interim win for Amazon.com
Inc  AMZN.O , which had alleged the deal between the Indian
firms breached 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 Future Group  FURE.NS  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 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: "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." 
    Reliance Retail intends to complete the transaction under
the terms of the agreement with Future Group without any delay,
Reliance Retail Ventures Ltd (RRVL) said in a statement on
Sunday.
    "RRVL has entered into the transaction for acquisition of
assets and business of Future Retail Limited under proper legal
advice and the rights and obligations are fully enforceable
under Indian Law," the statement added.  
    Future Group was not immediately reachable for comment.

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