Future Retail along with its promoters has moved the Delhi High Court requesting to stay and set aside the order passed by the Singapore-based arbitration tribunal SIAC on October 21, putting its Rs 24,713-crore deal with Reliance Retail on hold.
The Singapore International Arbitration Centre (SIAC) on October 21, had rejected the plea of Future Retail Ltd (FRL) to lift the interim stay granted by its Emergency Arbitrator on October 25 last year, over the deal with Reliance and upheld it by observing that “the Award were correctly granted”.
“The Company has filed an appeal before High Court of Delhi against the impugned order dated October 21, 2021 passed by SIAC on the Application of the Company to vacate the Interim Award of the Emergency Arbitrator dated 25 October 2020,” FRL said in a regulatory filing. It has requested the high court for “staying and setting aside the operation of the Impugned order dated 21 October 2021” and “alternatively, allowing the Company to conduct the meeting of the Shareholders and Creditors as directed by the NCLT Mumbai vide order dated 28 September, 2021”.
Earlier this month, the SIAC had also held that Future Retail is a party to the ongoing arbitration between Amazon and Future group in the dispute over the sale of its assets to Reliance Retail. Future had contended before the SIAC that it should be excluded from the arbitration proceedings because it is not a party to the dispute between its promoter Future Coupons Pvt Ltd (FCPL) and Amazon.
Amazon, which is trying to block Future’s Rs 24,713-crore sale of its retail, wholesale, logistics and warehousing assets to Reliance Industries’ retail arm, has alleged that the Reliance Retail Ventures Ltd (RRVL)-Future deal breaches its own pact of 2019, with the Kishore Biyani-led company. In October 2020, an interim award was passed by the EA in favour of the US e-commerce major Amazon that barred FRL from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.
In August last year, Reliance Retail Ventures Ltd had said it will acquire the retail and wholesale business, and the logistics and warehousing business of Future Group for Rs 24,713 crore. The deal has been contested by Amazon, an investor in FCPL that in turn is a shareholder in FRL.
In August 2019, Amazon had agreed to purchase 49 per cent of one of Future’s unlisted firm, Future Coupons Pvt Ltd (which owns 7.3 per cent equity in BSE-listed Future Retail through convertible warrants), with the right to buy into the flagship Future Retail after a period of 3 to 10 years. After Future’s deal with Reliance Retail Ventures Ltd (RRVL) in August last year, Amazon had dragged Future into arbitration at SIAC.
Amazon and Future have also filed litigations in Indian courts, including the Supreme Court, on the issue. The apex court had recently ruled in favour of Amazon by holding that the EA award was valid and enforceable under Indian laws. Earlier this month, Amazon had also filed an interim application filed before the Supreme Court of India to stay the order passed by the Mumbai Bench of the National Company Law Tribunal allowing Kishore Biyani-led Future Group firms to hold meetings of its shareholders and creditors to seek approval for the sale of assets to RRVL.
As per the regulatory filing of the several Future Group firms including FRL, the meeting of shareholders and creditors will take place on November 10 and 11.