Amazon Scores Big as Supreme Court Stalls Future's $3.4 Billion Retail Deal With Reliance

The Supreme Court of India has handed Amazon.com Inc. a major victory in a case where the US-based ecommerce firm sought to stall $3.4-billion Reliance-Future deal.

The outcome of the tussle involving two of the world's richest men — Amazon's Jeff Bezos and Reliance Industries' Mukesh Ambani — could reshape India's pandemic-hit shopping sector and decide if Amazon can blunt Reliance's dominance of the country's nearly trillion-dollar retail market.

Amazon and Future have been locked in legal battles over the Reliance-Future Retail deal, with the US firm accusing the Indian group of violating pre-existing contracts when it sold its assets to Reliance. Future has denied any wrongdoing.

A two-judge bench of the Supreme Court said that a decision by a Singapore arbitrator in October—that put the Reliance-Future deal on hold after finding merit in Amazon's objections—was valid and applicable in India. Amazon had argued that the order is binding, while Future had argued it was not. Both sides agreed to use the Singapore arbitrator in case of disputes when they entered into a $200-million deal in 2019.

Shares in Future Retail fell 6% after the order while those in Reliance Industries were down 1.3%.

Around 1,300 of Future's more than 1,700 retail outlets in 400 cities sell groceries. That makes Future a prized asset for both Reliance and Amazon.

 

August 06, 2021