Reliance Industries and Future Group stocks fell on Monday after a Singapore arbitration panel put on hold Future Group's $3.38 billion asset sale to Reliance Industries, an interim win for Amazon.
Reliance Industries fell as much as 2.2 percent to Rs 2,064.45 per share on the BSE. Meanwhile, Future Group stocks also declined with Future Retail down over 9 percent to Rs 70.55, Future Enterprises and Future Consumer falling 5 percent on the BSE.
Amazon had alleged the deal between the Indian firms breached existing agreements and had approached emergency arbitration to seek a stay on the deal until the arbitration process is complete, sources told CNBC-TV18.
Amazon last year bought a 49 percent stake in Future Coupons, which owns a 7.3 percent stake in Future Retail. Amazon had approached the Singapore International Arbitration Centre against the Future-RIL deal earlier this month, citing that its contract with Future Group gave it the first right of refusal and that it had a non-compete clause that prevented Future Group from approaching Reliance. Sources said that the contract also allowed for arbitration in Singapore in case of a dispute.
In a statement, Amazon said: “We are grateful for the order which grants all the reliefs that were sought. We remain committed to an expeditious conclusion of the arbitration process.”
Reliance Retail said that the company was informed of an interim order passed by the Emergency Arbitrator in the arbitration proceedings invoked by Amazon under a shareholders’ agreement with the promoters of Future Group.
Reliance Retail intends to complete the transaction under the terms of the agreement with Future Group without any delay, Reliance Retail Ventures Ltd (RRVL) said in a statement on Sunday.
“RRVL has entered into the transaction for the acquisition of assets and business of Future Retail Limited under proper legal advice and the rights and obligations are fully enforceable under Indian Law,” the statement added.
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