SIAC ruling has no legal status, Future Retail tells stock exchanges

SIAC ruling has no legal status, Future Retail tells stock exchanges
Kishore Biyani  |  Photo Credit: Reuters
2 Nov, 2020

Kishore Biyani-owned Future Retail (FRL) on Sunday told stock exchanges in India that they should not take cognizance of the injunction order issued by Singapore International Arbitration Center (SIAC)-appointed emergency arbitrator, as it had no legal status.

The ecommerce company on Friday notified SEBI, as well as NSE and BSE, of the SIAC order, in a bid to ensure that the deal does not get unconditional approval.

Amazon has sought damages of $192 million along with interest for its investment in Future Coupons, said the latest filing made by Future Retail with the BSE. “This contention raised by Amazon is entirely misconceived,” the filing said. 

Future Retail maintained in its filing that it was not a party to the transaction and that, “Any attempt on the part of Amazon to enforce the EA Order shall be resisted by FRL to the fullest extent available under Indian law. FRL is also in the process of taking appropriate legal action to protect its rights.”

The filing also said that there will be no change in the proposed acquisition until the order passed by SIAC is executed by an Indian court of appropriate jurisdiction. 

In the ongoing dispute, Amazon, which approached the SIAC on October 5, was awarded an injunction on October 25 against the proposed acquisition of Future Group, including its retail, wholesale, logistics and warehousing operation for $3.38 billion by Reliance Retail Ventures (RRVL), a subsidiary of Reliance Industries. 

Amazon had contended that the acquisition violates shareholder agreement between Future Retail and the Seattle headquartered ecommerce entity, which has an indirect shareholding in Future Retail through its 2019 investment in Future Coupons

A day after the interim order was issued by SIAC, Reliance Industries said that it will go ahead with the acquisition as proposed. Reports also suggested that RRVL was looking to file a countersuit against Amazon.