Amazon Slams Future Retail ‘Fraud’ as Talks With Reliance Fail
Amazon.com Inc. warned that any effort to transfer its assets to RIL would be liable for civil and criminal consequences.
(Bloomberg) -- Amazon.com Inc. told India’s top court that truce talks to bury the dispute with cash-strapped Future Retail Ltd. had failed, hours after it published newspapers notices warning the local retailer and its founders that any transfer of assets to Reliance Industries Ltd. would trigger civil and criminal legal action.
“We made efforts but nothing is possible,” Amazon’s lawyer Gopal Subramanium told the Supreme Court on Tuesday, adding that no resolution could be worked out despite meetings among senior executives. The American e-tailer, which had sought an out-of-court settlement on March 3, asked for resumption of arbitration against the indebted Future Group in the Singapore tribunal as well as an interim order to halt transfer of assets to Reliance.
The U.S. giant, in a notice published in the local newspapers, also said any transfer of assets to the billionaire Mukesh Ambani’s Reliance violated the tribunal’s order and the assertions made in the court. Two Future Group firms had informed exchanges last week that they had received termination notices on sub-leases of 893 stores from Reliance -- a move that has intensified the three-way fight with Kishore Biyani-led Future, which is caught in the tussle between two retail behemoths.
Future Retail and its founders “have been attempting to remove the substratum of the dispute” by transferring the assets, Amazon said in the newspaper notice. “These actions have been done in a clandestine manner by playing a fraud” on local regulators and courts in India and Singapore.
Fight for Dominance
Investors and lenders to Future Group hang in balance as Reliance and Amazon slug it out for dominance in India’s retail sector servicing almost 1.4 billion consumers. Amazon objected to Reliance’s August 2020 offer to buy Future Retail’s stores and warehouses for 247.1 billion rupees ($3.2 billion), saying the deal violated its 2019 agreement with another Future Group firm.
Reliance, in late February, quietly began taking over the rental leases of hundreds of stores once run by Future Retail and Future Lifestyle Fashions Ltd. amid the lawsuits and arbitration across India and Singapore.
Future Retail’s lawyer Harish Salve told the court the Indian retailer has not transferred any of its outlets and has in fact protested Reliance’s actions. “Amazon is driving us to our knees,” Salve said. “We couldn’t pay rent. Reliance made an agreement with the landlords and took over the stores.”
If stores are transferred to Reliance, there will be nothing for Amazon to fight for in courts, Amazon’s lawyer Aspi Chinoy said during the hearing on Tuesday. “After winning all the orders in courts, there’s nothing left for us to win,” Chinoy said.
The Supreme Court will decide on an interim order during a hearing on March 16.
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