Companies

Amazon knew about Future deal since June: Reliance Retail to HC

Forum Gandhi Mumbai | Updated on November 25, 2020 Published on November 25, 2020

Mukesh Ambani-owned Reliance Retail, in its submissions to the Delhi High Court, has said that Amazon had knowledge of the deal since June 2020. Reliance has attached a list of WhatsApp chats that occurred between Future Group’s promoters Kishore Biyani, Rakesh Biyani and Amazon India’s chief Amit Agarwal.

Amazon had claimed to the Emergency Arbitrator and to the Delhi High Court that it had learnt of the transaction between Future Retail and Reliance on September 16, 2020, when FRL uploaded the draft scheme of amalgamation on its website.

Reliance said in its submissions on November 23: “This is however, untrue in view of the fact that Amazon was well aware of the fact that Defendant No. 3 and FRL’s representatives were in discussions with Reliance in June and July 2020 itself. In fact, the discussions between Defendant No. 3, the representatives of FRL and Reliance have been acknowledged and discussed in WhatsApp chats between the representatives of Amazon and FRL.”

Loan default

On June 30, Agarwal had sent a media report link to Rakesh Biyani which stated that the deal between RIL and FRL was close to completion. To this Biyani had responded at length, saying: “Hi, Nothing concluded. Infact, I have been in touch with Abhijeet on the other tracks. I am talking to him now, for the Samara track. Samara needs your NOC on record to make the term sheet by tomorrow/Thursday. On Track 2 (Consortium), we have made the data room for Bain’s diligence. They should be starting their work next week onwards. RIL continues to be in discussion, but nothing conclusive.”

BusinessLine had reported earlier that between March 12 and 15, 2020, Amazon was notified by Future that the lenders had issued notices of events of default, requiring the Biyanis to either encumber more promoter securities or to repay the loans due to them.

“Breaches with respect to the encumbrances on promoter shareholding have occurred as early as March 2020. Amazon has been well aware of the fact that FRL was in talks with Reliance as far back as June 2020, but Amazon chose to remain conspicuously silent and not take any action to assert its alleged contractual rights against FRL for reasons best known to them,” Reliance said.

Stalled transaction

In its 24-page submission, Reliance further said: “The assets of FRL are suffering deterioration at a rapid pace and it is imperative that the transaction between FRL and Reliance is expeditiously concluded to stave off the prospect of the company going into liquidation.”

On the basis of the Singapore International Arbitration Court’s interim order, Amazon wrote multiple letters to statutory bodies, including Competition Commission of India, the NSE, the BSE and SEBI. Future Retail dragged Amazon to the Delhi High Court to get an injunction against the letters, as they were impacting FRL’s deal with Reliance.

Reliance said that Amazon is being a “dog in the manger” by seeking interference from the statutory authorities in an attempt to stall the transaction.

 

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Published on November 25, 2020
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