We'll pursue 'all available avenues' to protect stakeholders interest: Future Group on SC judgment

In a regulatory filing after the Supreme Court judgment in the Rs. 24,731-crore deal between the Reliance Industries Ltd and Future Retail Limited, the Kishore Biyani-led company has informed the stock exchanges that it intends to pursue “all available avenues” to conclude the deal so that the interests of its stakeholders and workforce are protected, writes Shravan Nune.

New Delhi: Future Retail Ltd (FRL) has said that it intends to pursue “all available avenues” to conclude its Rs 24,731-crore deal with Reliance Industries Ltd so that the interests of its stakeholders and workforce are protected. The statement came from the FRL after the Supreme Court ruled in favour of Amazon and upheld Singapore's Emergency Arbitrator (EA) award that had restrained the mega-deal in India’s retail space.

“FRL intends to pursue all available avenues to conclude the deal to protect the interests of its stakeholders and workforce,” the Future Retail informed the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on Friday.

In the regulatory filing, FRL further said that the SC judgement "addresses two limited points related to the enforceability of the EA's order and not the merits of the disputes".

"The full copy of the judgement is awaited. FRL is advised it has remedies available in law, which it will exercise," said the company .

The Future Group noted that the Arbitral Tribunal at the Singapore International Arbitration Centre (SIAC) has concluded hearings on the questions that whether the interim award of the EA should continue and whether FRL is at all a party in the arbitration proceedings.

"The decision of the Arbitral Tribunal is awaited," it added.

Vendors and suppliers have become "collateral damage"

According to the traders' body All India Consumer Products Distributors Federation (AICPD) and Public Response Against Helplessness and Action for Redressal (Prahar), mall vendors and suppliers have become collateral damage in the tussle between Amazon and Future Group as they have dues of Rs 6,000 crore from the Future Group.

An open letter written by both these organisations last March said that the vendors are in great financial as well as emotional stress.

"These dues are pending for payment since March 2020. The announcement of the Future-Reliance deal in August 2020 had given us hope that our dues will be cleared soon," AICPD and Prahar said in the letter.

Some vendors have said that they are on the verge of bankruptcy and had to pledge jewellery to pay for rents and the staff.

“I am in a desperate situation. I have severe pressure to pay rents and to the workers. I have exhausted all the options – sold jewellery and took all kinds of loans,” Jaya Chakravarthy, a Mumbai-based vendor told ETV Bharat.

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Echoing her views, another Mumbai-based vendor Pankaj Vira said that his firm Purple Creations has been on the verge of bankruptcy for the last two years.

“I was utilizing 50% of my capacity for the future group. As the payments were not made, we are unable to operate for the last two years,” Pankaj told ETV Bharat.

What is the issue between Amazon and Future Group?

In August last year, Reliance Retail Ventures Ltd (RRVL) had said it will acquire the retail and wholesale business, and the logistics and warehousing business of Future Group for Rs 24,713 crore. The scheme of arrangement entails the consolidation of Kishore Biyani-led Future Group's retail and wholesale assets into one entity Future Enterprises Ltd and then transferring it to Reliance Retail.

The deal has been contested by Amazon, an investor in Future Coupons that in turn is a shareholder in Future Retail Ltd.

In August 2019, Amazon had agreed to purchase 49 per cent of one of Future's unlisted firms, Future Coupons Ltd (which owns 7.3 per cent equity in BSE-listed Future Retail Ltd through convertible warrants), with the right to buy into the flagship Future Retail after a period of three to 10 years.

Amazon had dragged Future into arbitration at SIAC and in October, an interim award was passed by the EA in favour of the US-e-commerce major that barred Future Retail from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.

Amazon and the Future Group had also filed litigations in Indian courts, including the Supreme Court, on the issue.

On Friday, the apex court ruled in favour of Amazon by holding that the EA award was valid and enforceable under Indian laws.

The Supreme Court's order came over a petition filed by Amazon that had challenged an earlier order of the Delhi High Court.

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(With Agency Inputs)