Future Retail Ltd’s plea to be excluded from being a party to the Amazon-Future Coupons’ arbitration proceedings has been turned down and the Court of Singapore International Arbitration Centre (SIAC) has ordered that the arbitration shall proceed, according to sources close to PTI.
According to a PTI report: In October, a single-judge bench of V K Rajah had given an interim arbitration award, barring Future Retail Ltd (FRL) from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.
According to the sources close to the development, FRL had approached the Court of SIAC saying the arbitration proceedings were part of a contract to which the company is not a party. The company had pleaded that it be excluded from being a party on account of jurisdiction objection.
However, the Court of SIAC has decided that the arbitration process shall proceed and accordingly, a tribunal will be constituted in this matter.
Queries sent to Amazon and Future Retail Ltd did not elicit any response.
In August last year, Amazon bought 49 per cent in one of Kishore Biyani-led Future Group’s unlisted firms — Future Coupons Ltd (FCL) — with the right to buy into the listed flagship FRL after a few years, if the government were to undo its bar on foreign ownership of multi-brand retailers.
FRL ran into a severe cash crunch soon after the nationwide lockdown imposed to curb the coronavirus outbreak. It cut a deal with Reliance Industries Ltd (RIL) to sell assets for Rs 24,713 crore.
Then, Amazon dragged Future to arbitration at SIAC claiming that its contract with the unlisted FCL barred a transaction with a number of persons and companies, including Reliance.
Amazon has also written to markets regulator Sebi and stock exchanges, urging them to take into consideration the Singapore arbitrator’s interim judgement that has put on hold the Rs 24,713-crore deal between Future group and RIL while reviewing the proposed transaction.
Last week, Competition Commission of India (CCI) cleared the deal.