Amazon led by its founder Jeff Bezos is playing dirty and ugly in the Indian market. For over two years, the company with its limitless money coffers has tried every trick in the book to destroy Future Retail Group (FRG), after the latter signed a deal with Reliance Retail Ventures Limited (RRVL). Led by its founder Jeff Bezos, Amazon is attempting to tank the merger as it will threaten its position in the Indian market.
Reportedly, the Future Group on Friday, in front of the bench comprising Chief Justice of India NV Ramana, Justice Krishna Murari and Justice Hima Kohli remarked that Amazon had destroyed the ₹26,000 crore company. The bench was hearing a special leave petition filed by Amazon against Delhi High Court’s order staying further arbitration proceedings before the Singapore Tribunal against Future Group.
Countering Amazon’s statement, senior advocate Harish Salve, appearing for FRL argued, “For ₹1,400 crores (the Amazon-Future deal), Amazon has destroyed a ₹26,000 crore company. Amazon has been successful in what it wanted to do. We are hanging by a thread. No one wants to do business with us now. When the landlord gives an eviction notice, then what can we do,”
Amazon is not allowing Reliance to take over the remaining stores, ever since the deal was announced way back in 2020. As a result, Future Group, which already had been reeling under severe financial stress, only coupled with the numerous Covid waves is now struggling to keep hold of the remaining 374 stores as landlords threaten eviction.
Nobody willing to give us anything: FRL
According to a LiveLaw report, Salve said, “Reliance entered into agreements with landlords. We owe them 3000 crores of rentals. Once this goes into section 7 of IBC, all this will come to an end. No one wants to do business with FRL as section 7 may come in any day.
Salve argued about Amazon’s predatory tactics by remarking, “In February 2022, we couldn’t find a solution to NPA, bank accounts were frozen. Nobody today is willing to give us anything today. 374 stores somehow we are running today, we’re managing. Most employees have left. Amazon wanted to destroy us and they have,”
Reliance and its deal with Future Group; Amazon playing the devil
As reported extensively by TFI, with an eye to capture the market, Mukesh Ambani, in August 2020, cracked a deal that would have established Reliance’s presence in India’s e-commerce market and overturned the competition posed by Amazon and Flipkart.
Reliance Retail Ventures Limited (RRVL) bought Kishore Biyani led Future Retail Limited for ₹ 24,713 crores. However, Amazon, an investor in Future Coupons that, in turn, is a shareholder in Future Retail Ltd., vehemently objected to the deal.
Fuming that Reliance and Future group were going to destroy Amazon, Jeff Bezos took the Future Group to court on the basis of a non-competitive clause that it has signed with the wholly-owned but unlisted subsidiary of the Future Group.
Amazon, being the devious corporation it is, stalled the deal. In a nutshell, a measly $200 million investment in Future Group in 2019 by Amazon stopped the $3.4 billion deal between Reliance and Future Group.
However, in December 2021, India’s antitrust agency Competition Commission of India (CCI) suspended Amazon’s deal with Future Group. The regulator ruled that the US-based company had suppressed information while seeking regulatory approval on investment into Indian retailer Future Group two years ago.
To add insult to injury, the agency also imposed a penalty of around 2 billion rupees ($27 million) on Amazon and has asked it to start from scratch regarding the approval process.
Moreover, in January, Delhi High Court had stayed the arbitration proceedings initiated by Amazon before a Singapore tribunal. The Delhi High Court division bench stated that there was a “prima facie case” in Future group’s favour given the suspension of clearance given to Amazon’s 2019 deal with Future Coupons (FCPL) by the Competition Commission of India (CCI).
Amazon has been on the backfoot in this case for some time. However, with its money might, it is able to extend the tedious legal process for sadistic pleasure. Meanwhile, Future Group, barely surviving, is having a tough time putting up the righteous fight.