NEW DELHI (Reuters) – Future India Group expects quick regulatory approval of its $ 3.4 billion deal to sell its assets at retail, its executive said, even while its trading partner at war Amazon.com Inc. intensifies efforts to block the deal.
Future and Amazon disagree with the Indian group’s August deal with Reliance Industries Ltd. The American giant alleges that the deal breached some of its pre-existing contracts with Future.
A New Delhi court in December rejected Future’s request to curb Amazon’s repeated attempts to get authorities to paralyze the deal. But the judge left the fate of the transaction to the regulators.
“The court has already given its opinion that all institutions can have an opinion” on the sale, Future Group founder and CEO Kishore Biyani told Reuters in an interview. “So there’s no reason why things should be delayed.”
Amazon declined to comment on Biyani’s statements. Reliance did not respond to any requests for comment.
The Securities and Exchange Board of India (SEBI), the market regulator that has been reviewing the deal for months, did not respond to any requests for comment.
SEBI and India’s stock exchanges could still reject or take longer to approve the deal, which is critical to the survival of Future Retail, which has more than 1,700 outlets severely affected by the COVID-19 pandemic.
Future Retail has warned that failure to close the deal could lead to the liquidation of the company and the loss of jobs of more than 29,000 employees.
“We have restored businesses to some extent, but there are challenges,” said Biyani, dubbed the retail king of India for having transformed the country’s retail trade in recent decades.
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The outcome of the dispute involving Future, Reliance and Amazon is shaping India’s retail landscape, especially when deciding who will have an advantage in the grocery market that is expected to be worth about 740,000 million dollars a year in 2024.
Following Amazon’s 2019 deal with a Future unit, the Indian retailer’s supermarkets and fashion products are for sale on Amazon’s website, while Future stores also act as local stores serving the food giant’s supply chain
Biyani said he had no intention of changing his business ties with Amazon despite the sour relationship. Criticizing Amazon, however, Biyani said he was confused by what he wanted to achieve Amazon by blocking his deal.
“I’m disappointed,” he said. “What do they want? Do they want to suffer so many employees, that business will fall? “
Amazon also took Future to a Singapore arbitrator, who passed an interim order in October saying the dependency agreement should be stopped. Although Future says the order is not binding, the American e-commerce giant continues its efforts to block the deal.
In a letter on Tuesday, Amazon called on the Indian BSE and NSE exchanges to suspend review of the deal in light of Singapore’s ongoing arbitration.
To bolster its case, Amazon on December 30 shared with the exchanges a confidential 63-page legal opinion signed by a former chief justice of India, Dipak Misra. According to the opinion, seen by Reuters, Misra said that SEBI or any other legal authority “cannot ignore” the interim order approved by the arbitrator.
Misra and the NSE did not immediately respond to emails seeking comments. BSE declined to comment.
Reports of Aditya Kalra in New Delhi; Additional reports from Abhirup Roy in Mumbai; Edited by William Mallard