The cat fight which has been going on for about 18 months between amazon and reliance, a retail market worth 635 million at stake.
A quick flashback to the past, after seeing the enormous success of Big bazaar and offline retail service Kishore Biyani (CEO of Future group) decided to diversify and extend to online retail, insurance and financial services amongst a host of other services. With really tough competition from flipkart, dmart and amazon, his ambitious plans soon came crumbling down when the parent company started piling losses which led to reliance group grabbing future group for 24,713 crores as they extended the lease of over 200 stores to their name.
Future retail are facing an ownership battle from Amazon and Reliance, one of the largest retailers in India. Future Enterprises will subsequently that includes key name brands such as Big Bazaar, fbb, Foodhall, Easyday, Nilgiris, Central and Brand Factory will be sold to Reliance Retail and Fashion Lifestyle Limited (RRFLL), a wholly-owned subsidiary of Reliance Retail Ventures Limited (RRVL). Seeing this, Amazon took object to the deal. As Amazon had invested 14,000 crores in future group and had special rights over assets held by Future Retail Limited. In August 2019, Amazon acquired 49 per cent stake in Future Coupons, the promoter entity of FRL (Future Retail), for around Rs 1,500 crore, this happened prior to the $3.4-billion asset-sale deal with Reliance Industries.
In 2020, Amazon sent a legal notice to Future claiming the alleged breach in agreement. Under the contract any breach or violations of the contract will be arbitrated under Singapore International Arbitration Center and later that year the emergency arbitrator ruled in amazon’s favor, essentially restricting any asset transfers and consummation of the deal with reliance.
Written By : Sharvari Salunke
Edited By : Padmaja Uttarwar