The Delhi High Court on Monday dismissed a plea from India’s Future Group that sought to restrain US partner Amazon from interfering in its $3.4-billion (roughly Rs. 25,000 crores) asset sale to Reliance.
Future sold its retail assets in August to Reliance in a deal Amazon said breached agreements Future made with the U.S. ecommerce leader in 2019.
In October, Amazon had won an injunction to halt the sale from a Singapore arbitrator that the sides had agreed to use in case of dispute.
Future later said the order was not binding, prompting Amazon to lodge a complaint with India’s market regulator.
Future is widely credited as transforming India’s retail sector in recent decades. However, the COVID-19 pandemic has hit the business so hard that founder Kishore Biyani sought a buyer.
The Competition Commission of India (CCI) last month approved Future’s sale of its retail, wholesale, logistics and warehousing businesses to billionaire Mukesh Ambani’s Reliance.
On Monday, the court observed that the suit filed by Future Group unit Future Retail was maintainable and its resolution approving the transaction with Reliance was also valid.
However, it noted that Amazon cannot be barred from writing to regulators on account of potentially irreparable damage, Justice Mukta Gupta said in the verdict.
India’s retail sector is likely to grow 46 percent over the next four years to an annual $1.3 trillion (roughly Rs. 95,74,500 crores), showed data from Forrester Research. The key battle is over groceries, likely to be worth around $740 billion (roughly Rs. 54,50,100 crores) a year by 2024, the data showed.
Reliance and Future dominate the market in India, with the next competitor, Avenue Supermarts’s DMart, being far behind in terms of stores and reach.
© Thomson Reuters 2020
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