NCLT Allows Reliance To Hold Creditors' Meet For Future Retail Deal
The NCLT said Amazon’s objections were premature and can be considered at the relevant stage.
The National Company Law Tribunal on Monday gave a go-ahead to the Reliance Industries Ltd. for convening a meeting of its creditors and shareholders to consider the deal with Future Retail Ltd.
The Mumbai bench of the tribunal allowed the first motion application filed by Reliance seeking its permission for the meeting. The tribunal rejected objections by Amazon NV Investment Holdings LLC at this stage, noting them to be premature. The court added that Amazon’s objections can be considered at the relevant stage.
The Supreme Court is already seized of the matter and no final order is being passed on the scheme of amalgamation. The tribunal clarified that it was giving the approval only for the first motion application.
The story so far….
Last month, the NCLT had allowed a similar application by Future Retail. Future Group had also filed a plea to hold shareholders meeting and seek their approval for consolidation of its entities—the first step in its ultimate sale to Reliance Retail Ventures Ltd.
In August 2020, Kishore Biyani’s Future Group announced the transaction to sell its retail, wholesale, logistics and warehousing assets to Reliance Industries Ltd.’s retail arm at a value of Rs 27,513 crore.
But the transaction soon faced legal challenges from Amazon.
The top court is hearing a petition by Future Retail against a Delhi High Court order that had directed to attach the assets of Kishore Biyani and others and also issued them a show-cause notice for wilful violation of the Singapore emergency arbitrator’s order. The emergency arbitrator’s order had put the transaction between Future Retail and Reliance Retail on hold.
The top court passed an interim order asking the NCLT to not pass any final order on the scheme of amalgamation. However, it clarified that the procedural steps for the scheme of amalgamation can continue.