Amazon is relieved from its long-standing legal battle with Kishore Biyani-led Future Group as the Singapore International Arbitration Centre (SIAC) ruled in favour of the e-commerce giant on Thursday. The case is related to Mukesh Ambani-led Reliance Retail and Future Group that violated Amazon’s pre-existing contract following a merger deal between the two in 2020.
The three-member SIAC tribunal said that the resolution passed by the Kishore Biyani-led group allowing the sale of retail, wholesale, and logistics assets to Reliance Retail in 2020 breached the contractual obligations under the shareholders agreement (SHA) and share subscription agreement (SSA) signed between Amazon and Future Coupons.
Although the arbitration tribunal ruled in favour of Amazon, the damages received by the ecommerce giant are marginal compared to what it had sought. The giant had sought damages worth ₹ 1,436 crore but the tribunal awarded ₹ 23.7 The amount along with interest at 10.3% annually from March 9, 2022 until full payment will be paid by 11 promoters, including Kishore Biyani-led group.
What Went Wrong
The Kishore Biyani-led Future Group, which led India’s biggest retail grocery chain before Covid-19 pandemic hit, got caught in the tussle between the two giants i.e., Amazon and Reliance in 2020. The clash began after Amazon objected to Reliance’s 2020 proposal to purchase Future Retail’s stores and warehouses for ₹ 247.1 billion, claiming the deal violated its 2019 agreement with another Future Group firm as it took life out of Future Retail. Back then, Future Retail had failed to meet certain debt obligations and was close to facing bankruptcy risk.
Despite Amazon’s many efforts, Reliance Industries reportedly began poaching employees and taking over rental leases of stores run by Future Retail and Future Lifestyle Fashion. This eventually led Amazon to take a legal route to seek settlement.
