Indian stock exchanges on Wednesday gave the go ahead for Future Group’s $3.4 billion deal to sell its retail assets, taking it a step closer toward closing a deal that has soured its ties with its business partner Amazon.com.
Future and Amazon are locked in legal tussles over the Indian group’s August deal with Reliance Industries. The US e-commerce giant alleges the deal breached some of its pre-existing contracts with Future.
In late night notifications, Indian exchanges said they had no objection or adverse observation on the deal, saying they had reached the decision after communicating with India’s markets regulator, the Securities and Exchange Board of India (SEBI).
SEBI has advised that Future should share various details of company’s ongoing litigation with Amazon when it approaches India’s National Company Law Tribunal, which also needs to sign off on the deal, the Bombay Stock Exchange notification said.
SEBI has separately not made its observations public. Reliance and Future did not immediately respond to a request for comment.
The notifications will be a setback for Amazon, which has in recent weeks repeatedly written letters to SEBI and stock exchanges to suspend the deal’s review.
Amazon has also dragged Future before a Singapore arbitrator, which passed an interim order in October saying the Reliance deal should be halted. Future says that order is not binding on it.
Following the nod from the exchanges, Amazon in a statement said it would continue to pursue legal remedies to enforce its rights, noting that the approvals were subject to the outcome of the ongoing arbitration process and other lawsuits.
The outcome of the dispute embroiling Future, Reliance and Amazon is seen shaping India’s retail landscape, especially in deciding who will emerge as a leader of a groceries market expected to be worth around $740 billion a year by 2024.
(With inputs from Reuters)