RIL, Future Retail stocks under pressure after Singapore arbitration court rules in favour of Amazon
- The shares of Reliance Industries and Future Retail cracked 2% and 6% during the early trading hours on Monday.
- The Singapore-based single judge arbitration panel asked Future group to stall its retail business deal with RIL until the arbitration panel decides on it.
- The decision also moved other Future Group stocks such as — Future Lifestyle Fashions trading 8% lower and Future Enterprises down nearly 5%, among others.
VK Rajah, the sole arbitrator in the Amazon vs Future vs Reliance arbitration case, while passing an interim award in favour of Amazon, asked the Future Group to put the retail deal with RIL on hold until the arbitration panel decides on the matter.
The decision also moved other Future Group stocks such as — Future Lifestyle Fashions trading 8% lower and Future Enterprises down nearly 5%, among others.
Future Retail (FRL) also informed investors that it is examining the communication and the order. However it further added that Future Retail is not party to the agreement under which Amazon has invoked arbitration proceedings.
“In any enforcement proceedings, FRL would take appropriate steps to ensure that the proposed transaction will proceed unhindered without any delay,” it said in a statement.
Reliance Industries too intends to complete the transaction
Mukesh Ambani-led Reliance Industries too said that it intends to enforce its rights and complete the transaction with Future Retail. Reliance Retail Ventures in a statement said that it has entered into the transaction for the acquisition of assets and business of Future Retail under proper legal advice and the rights and obligations are fully enforceable under Indian law.
“RRVL intends to enforce its rights and complete the transaction in terms of the scheme and agreement with Future group without any delay,” RRVL said in a statement.
What triggered the Amazon vs Future Group case?
AdvertisementEarlier this month, e-commerce giant Amazon.com stepped in and said that Future Group violated a contract with it by entering into the sale agreement with the Mukesh Ambani-led retail major. This after Reliance Retail acquired Kishore Biyani’s Future Group in August for ₹25,000 crore in a slump sale.
Last year, Amazon acquired a 49% stake in Future Coupons, a Future group entity. And earlier this month, the e-commerce giant sent a legal notice over the Reliance-Future retail deal, saying that it had been denied the Rights of First Refusal for the deal with Future Group.
(with inputs from wire services)
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