Reliance Retail’s Acquisition of Future Group Businesses Approved
The CCI approval is a turning point in the Jeff Bezos vs Mukesh Ambani battle for the crown of India’s retail king.
In a setback for Amazon, the Competition Commission of India (CCI) has approved the acquisition of retail, wholesale, logistics, and warehousing businesses of the Future Group by Reliance Retail Ventures Ltd and Reliance Retail and Fashion Lifestyle Ltd.
CCI announced the decision on Twitter on Friday. "Commission approves acquisition of retail, wholesale, logistics & warehousing businesses of Future Group by Reliance Retail Ventures Limited and Reliance Retail and Fashion Lifestyle Limited," it said.
The CCI decision marks a major turning point in the Jeff Bezos versus Mukesh Ambani battle for the crown of India’s retail king as Amazon is engaged in litigation over the sale of Future Group retail assets to Reliance Retail.
Amazon had approached the Emergency Arbitrator in Singapore seeking relief in the Future-Reliance Retail deal.
The proceedings against Future Retail Ltd (FRL) are not maintainable as FRL is not a party/signatory to the arbitration agreement invoked by Amazon, the company had said.
In a regulatory filing, the company said that FRL's jurisdictional objections are pending determination with the SIAC Registrar.
Emergency Arbitrator Appointed By SIAC
Further, the SIAC has appointed an Emergency Arbitrator, however, the Indian law does not recognize an Emergency Arbitrator. "Accordingly, the Interim Order is unlikely to have an impact either on the FRL or the Company," it said.
It said that notice of Arbitration has been issued by Amazon against FRL and other FRL promoter group persons in accordance with the Singapore International Arbitration Centre ("SIAC") Rules for alleged violation of the provisions of the shareholders agreements.
Further, as per SIAC Rules, Amazon has filed an application seeking interim relief, injuncting the Respondents from giving effect to the Composite Scheme of Arrangement.
“As per information received, FRL is in process of initiating appropriate proceeding to protect its rights and seek necessary reliefs against in relation to the interim award which is not enforceable under Indian law,” the company said.
"There would not be any change in status of the proposed scheme until the Interim Order passed by the Emergency Arbitrator of SIAC is executed by the Indian court of appropriate jurisdiction," the company said
In August, Reliance had announced the acquisition of retail businesses of Future Group for Rs 24,713 crore.
Future Group's retail and wholesale undertaking will be transferred to Reliance Retail and Fashion Lifestyle Ltd (RRFLL) which is a wholly-owned subsidiary of RRVL.
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