Future Group faces setback, Amazon scores win as Delhi HC halts deal with RIL; Future stocks dip 5% each

The Future Group - RIL deal has received approval from CCI and market regulator SEBI.

Feb 03, 2021 12:02 IST India Infoline News Service

Future Group stocks on Wednesday froze to the lower circuit and resulted in a downside of 5% each after the latest verdict from Delhi High Court ruled in favour of Amazon Inc, and halted the deal with Reliance Industries (RIL) retail arm.

At around 12.27 pm, Future Retail traded at the lower price band of Rs78.10 per piece, similarly, Future Supply Chain Solution traded at the lower circuit of Rs100.15 per piece.

Furthermore, Future Lifestyle Fashions (Rs88.35 per piece), Future Market Networks (Rs21 per piece), Future Enterprises (Rs11.73 per piece) and Future Consumer (Rs8.21 per piece) also hit their lower circuit.

The above-mentioned stocks have recorded a slump of 5% each.

Future Retail (FRL) on Tuesday intimated exchanges about Delhi HC verdict.

FRL said, "The Learned Single Judge, Justice Midha, of Hon’ble Delhi High Court today, in a petition filed by Amazon for enforcement of the interim award of the Emergency Arbitrator, has ordered status quo with respect to the scheme of arrangement."

"The Company is legally advised that the basis of the interim award of the Emergency Arbitrator has been superseded by the judgement dated December 21, 2020 passed by the Learned Single Judge, Justice Mukta Gupta of Hon’ble Delhi High Court," adding FRL said, "The Company will explore all legal remedies and take appropriate steps to pursue the scheme of arrangement."

Last month, Amazon had filed a petition before Delhi HC, where the e-commerce giant alleged of a deliberate and wilful breach and violation” of the SIAC emergency arbitrator’s award by Kishore Biyani-led Future Group.

Amazon had sought detention from the Delhi court for Biyani and other directors of Future Retail, Future Coupons, Future Coupons Resources and Akar Estate and Finance in civil prison over violation of arbitrator’s interim award.

According to Bar and Bench report earlier today, Future Retail Ltd has moved the Division Bench of the Delhi High Court in appeal against order directing status quo on deal with Reliance.

The report said that a Division Bench of Chief Justice DN Patel and Justice Jyoti Singh said that the matter would be heard tomorrow.

The Mukesh Ambani-backed RIL signed the merger deal worth Rs24,713cr with Kishore Biyani-backed Group's retail and logistic subsidiaries through Reliance Retail Ventures in August 2020.

As part of the agreement, Future Group's retail & wholesale undertaking is being transferred to Reliance Retail and Fashion Lifestyle Limited (RRFLL), a wholly-owned subsidiary of Reliance Retail Ventures (RRVL). Further, the Future Group's logistics & warehousing undertaking will be transferred to RRVL.

The Future Group - RIL deal has received approval from CCI and market regulator SEBI. The companies involved have filed the scheme of arrangement before the NCLT, Mumbai on January 26, 2021. The application is yet to be taken up by NCLT.

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