BY- KESHAV KAUSHIK
The ever-intense legal battle between Jeff Bezos’ Amazon company and Kishore Biyani’s Future company has reached Delhi High Court. Amazon filed a petition in Delhi High Court claiming deliberate disobedience of the contract made between Amazon and Future Group and has requested Delhi HC to pass an injunction to stop the deal. Amazon has also asked SEBI and BSE to not allow the deal between Future Group and Reliance Limited.
Last year, a 2000-crore deal was struck between Amazon and Future Group. It gave 49% of Future’s share to Amazon and an option to acquire all or a part of Future’s Coupon promoter, Future Retail’s shareholding company within 3-10 years of the agreement. When the deal between Reliance and Future was made, Amazon accused Future of breaching the non-compete clause and also the right-to-first-refusal clause of the contract.
Future Group denied these allegations and asserted that they have merely sold the assets of the company, which were not a part of the deal made between them and Amazon. Future Group had also filed a plea in November as a response to Amazon’s request to SEBI and BSE to stop the Future-Reliance deal. Court however refused to entertain the plea and handed the case over to statutory authorities.
Amazon’s plea also demanded detention of the owners of Future Group including Kishore Biyani so that they cannot possibly intervene or proceed with the destined Future –Reliance deal and therefore, cannot impugn on the agreement made between them and Future.
From a business point of view, this deal is a bone of contention for Amazon as Reliance is one of its biggest competitors in the retail market and the Future-Reliance deal can be a major hindrance to Amazon’s expansion in India. Amazon has just lost the retail battle in China and India is the next biggest market for him. Also, it has to take on Walmart’s Flipkart and Reliance simultaneously, thus this deal can provide Reliance with an edge over its competitors.