August 29, 2021 1:06:30 am
Future Retail (FRL) on Saturday moved the Supreme Court against an order by the Delhi High Court to maintain status quo in relation to the Kishore Biyani-led company’s Rs 24,713-crore deal with Reliance Retail and directing it to enforce the Singapore-based Emergency Arbitrator’s (EA) order.
“Please be informed that the company has filed a special leave petition before the Supreme Court against the impugned orders dated February 2. 2021 and March 18, 2021 passed by ‘Ld. Single Judge’. The SLP will be listed for hearing in due course,” FRL said in a regulatory filing. It has argued that if the deal with Reliance doesn’t go through, it would cause “unimaginable” damage to the group, including possible job losses for 35,575 employees, and put at risk roughly Rs 28,000 crore in bank loans and debentures.
Amazon, which has been involved in a dispute with Future, accuses FRL of violating contracts when it sold its retail assets to Reliance Industries (RIL) last year.
On February 2, a single-judge bench of the Delhi HC had directed FRL to maintain status quo in relation to its deal with Reliance Retail, an RIL arm, which was objected to by Amazon. Justice J R Midha said the court was satisfied that an immediate interim order was required to be passed to protect the rights of Amazon.
Later, on March 18, the court upheld the Singapore-based EA’s order restraining FRL from going ahead with its deal with Reliance Retail to sell its business, which was objected to by Amazon.
Justice Midha directed FRL not to take further action on the deal with RIL and held that the Future Group willfully violated the EA’s order. The high court rejected all the objections raised by Future Group and imposed a cost of Rs 20 lakh on it as well as its directors.
Earlier this month, Future Group promoters — including Biyani and several group holding companies — had approached the Supreme Court against an order passed by the Delhi High Court directing to enforce the order of the Singapore-based EA.
Passing an interim order, the EA of Singapore International Arbitration Centre (SIAC) had on October 25 last year restrained Future Group from going ahead with its deal with RIL to sell its retail and wholesale business, and the logistics and warehousing business. Amazon, which has 49 per cent stake in one of Future’s unlisted firms, Future Coupons Ltd had approached the SIAC.
In August last year, Reliance Retail had said it would acquire the retail and wholesale business, and the logistics and warehousing business of Future Group in a deal worth Rs 24,713 crore. The scheme of arrangement entailed consolidation of Future Group’s retail and wholesale assets into one entity Future Enterprises Ltd and then transferring it to Reliance Retail.
The deal has been contested by Amazon, an investor in Future Coupons that in turn is a shareholder in Future Retail Ltd. The apex court had on August 6 upheld Amazon’s plea.
It had ruled in favour of Amazon and held that an award of an EA of a foreign country is enforceable under the Indian Arbitration and Conciliation Act.
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