Kishore Biyani-owned Future Group approached the National Company Law Appellate Tribunal (NCLAT) on January 26, to seal the deal for the sale of its retail, wholesale, logistics and warehousing businesses to Reliance Retail for over INR 24K Cr. The revelation was made by Future Group’s lawyer to the Delhi High Court.
This development came, even as ecommerce giant Amazon has filed another petition in the high court, seeking imprisonment of Biyani and other Future Group promoters, Amazon wrote in its petition that the company’s promoters had violated securities market rules by illegally encumbering group company shares.
Amazon has been trying to stall the Reliance-Future deal for long.
In 2019, Amazon had bought a 49% stake in Future’s unlisted firm, Future Coupons, the promoter-entity of Future Retail, (which owns 7.3% equity in BSE-listed Future Retail Ltd through convertible warrants), with the right to buy into the flagship Future Retail after a period of three to 10 years.
In October, Amazon approached the Singapore International Arbitration Centre (SIAC) and won a temporary injunction against the INR 24,713 Cr deal for the sale of Future Retail to Reliance Retail.
Amazon had contended that by entering into a deal with Reliance, Future Group was violating a non-compete contract, as the sale of businesses to certain companies (including Reliance) was barred.
In its ruling last month in response to a petition filed by Future Group against Amazon, the Delhi HC had refused to restrain Amazon from writing to statutory authorities such as the Securities and Exchange Board of India (SEBI) to explain its case but had also given the go-ahead to the Reliance-Future deal, subject to approval from regulators.
Indian regulators, the Competition Commission of India (CCI) and SEBI have approved Reliance Retail’s acquisition of Future Retail.
Besides the Reliance-Future deal, Amazon’s woes in India seem to have multiplied. The company is being probed by the Enforcement Directorate for alleged violations of the Foreign Exchange Management Act (FEMA).
The probe was initiated after ED received communication from the commerce ministry seeking “necessary action” against ecommerce players like Amazon and Flipkart pertaining to certain multi-brand retail businesses and an observation made by the Delhi High Court in relation to Amazon.
Other News
- The Indian government has approved the Startup India Seed Fund Scheme (SISFS), which will provide early-stage funding to tech startups via a corpus of INR 945 Cr, to be disbursed through select startup incubators between 2021-25.
- While everyone expected Reliance Jio to first launch 5G services in India, Bharti Airtel, on Thursday (January 28), announced that it has become the first telecom service provider in India to successfully “demonstrate and orchestrate” live 5G services.
- The Indian government’s Ministry of Information and Broadcasting is working on a special set of guidelines for the regulation of content on over-the-top (OTT) video streaming platforms such as Amazon Prime Video, Netflix, Disney+ Hotstar and others.
- As the Indian government holds its ground on the ban on over 250 Chinese-origin apps including TikTok in India, TikTok’s parent company ByteDance has decided to lay off employees from its India workforce of 2,000. The Chinese company has told employees in India that only those in critical roles will be retained.
- Bengaluru-headquartered Swiggy has edged out its main competitor Zomato in terms of the annual revenue for FY2020 as well as the overall rate of increase in losses.
Stay tuned for next week’s News Roundup.