The Competition Commission of India (CCI) on Friday cleared Reliance Industries’ (RIL) bid to buy Future group’s retail, wholesale and logistics assets even as etailer Amazon sought to block the transaction, alleging contractual violations by the latter.
The approval, coming amid a legal battle being waged by Amazon and contested by Future, marks a step-up in the regulatory process needed to complete the nearly Rs 25,000-crore deal.
Future is seeking to get out of its debt trap with the deal, while Reliance is looking to consolidate its position as the country’s largest organised retailer with the transaction. The two players have said that they will go ahead with the regulatory process despite Amazon’s objections.
The American giant had earlier approached the CCI and the country’s markets regulator Securities and Exchange Board of India (Sebi) as well as the stock exchanges, urging them to consider the stay order it had received from the Singapore arbitration panel last month.
Amazon has argued that a 2019 agreement it inked with Future prevented the Indian group from selling its retail assets to certain parties, including Reliance, led by the country’s richest man, Mukesh Ambani. The agreement gives Amazon an indirect stake of 5 per cent in Future Retail, the flagship company of the Future group.
Future Retail, however, said the agreement in question was not with the company, but with the company’s largest shareholder (Future Coupons) and that the arbitration order was not valid in India. It has also taken Amazon to court in an effort to prevent it from sending letters to regulators and blocking the deal.
On Thursday, the retail arm of RIL said it had completed its divestment programme by raising Rs 47,265 crore from investors after selling 10.09 per cent stake.
“This is the largest fundraising exercise in the sector completed within two months,” RIL said. “All the investments have been completed with receipt of funds and issue of shares,” it added.