The Delhi High Court on Monday declined to grant Kishore Biyani led Future Retail Ltd’s (FRL) plea for an interim injunction restraining Amazon from writing to SEBI, CCI and other authorities about the arbitral order against its asset sale. The court had reserved its verdict for today on November 20.
On August 29 this year, the Future Group announced sale of its retail and wholesale business to Reliance Retail in a Rs 24,713 crore deal. It announced plans to merge key group companies, including Future Retail, Future Lifestyle Fashions, Future Consumer, Future Supply Chains and Future Market Networks into FEL.
However, the Jeff Bezos led company argued that a 2019 pact it signed with Future prevented the Indian company from selling its retail assets to certain parties. It had also won an interim award against the transaction between RIL and the Future group after a Singapore-based single judge arbitration panel put the transaction on hold.
The Future plea sought to restrain Amazon from interfering in the Reliance Retail-Future deal on the basis of an interim order passed by the Singapore International Arbitration Centre (SIAC). Amazon had taken Future Retail into an emergency arbitration over alleged violation of contract.
Meanwhile, the Competition Commission of India (CCI) cleared the Future-Reliance deal in November saying, “Commission approves acquisition of retail, wholesale, logistics & warehousing businesses of Future Group by Reliance Retail Ventures Limited and Reliance Retail and Fashion Lifestyle Limited.” The online giant had claimed before the CCI that the so called “injunction” of the Emergency Arbitrator was binding on CCI and that CCI should stop processing the application and should not give its approval.
It had been pointed out that Future Retail Limited (FRL) is a listed company and Section 230-234 of the Companies Act is a code in itself.
A company and its shareholders/creditors have unrestricted right to enter into a scheme of arrangement. The only requirement is that the scheme has to be passed with requisite majority.
Future Enterprises Ltd reported a consolidated net loss of Rs 320.56 crore for the second quarter ended September 2020, on account of lower revenue from operations. The company had posted a net profit of Rs 21.78 crore in the corresponding quarter a year ago.
Source: Business-Standard