Amazon asks Sebi to comply with SC order

In its more than 6,000 page filing, Future has reportedly argued that if the deal with Reliance doesn't go through, it would cause 'unimaginable' damage to the group.

US e-commerce giant Amazon has written to Ajay Tyagi, chairman of market regulator Securities and Exchange Board of India (Sebi), to take action as is necessary to comply with the Supreme Court Judgment, related to the $3.4-billion merger deal between Future Group and Reliance.

Amazon has requested Sebi to direct the Indian stock exchanges to withdraw the Observation Letters related to this deal with immediate effect.

In January this year, Sebi had given a go-ahead onto Future Group's scheme of arrangement and sale of assets to Reliance, based on which the Bombay Stock Exchange also granted its "no adverse observation" report to the Rs 24,713-crore ($3.4 billion) deal.

Sebi had allowed the deal with some riders, five months after it was announced last year in  August.

However, earlier this month, the Supreme Court ruled in favour of Amazon in a case that pitched the American online major against India’s original retail king Kishore Biyani’s Future Group and Mukesh Ambani’s Reliance Retail, which is set to go big on e-commerce.

The ruling puts the $3.4-billion merger deal between Future and Reliance on hold for now.

In the letter, Amazon referred to the Supreme Court Judgment upholding the enforcement of the Interim Award issued by the Emergency Arbitrator in SIAC (Singapore International Arbitration Centre) Arbitration.

Amazon said the Observation Letters were conditional on the outcome of the ongoing proceedings, and the Supreme Court has upheld the enforceability of the EA (Emergency Arbitrator) Order.

It had injuncted inter alia the presentation, pursuit and carriage of the applications before the Indian stock exchanges.

“In light of the directions contained in the Enforcement Judgment, and the EA Order whose validity has been affirmed by the Hon’ble Supreme Court, Amazon requests you to take all such action as is necessary to comply with the Supreme Court Judgment, and to further ensure that no communications subsist or emanate which are at variance with the Supreme Court Judgment,” said the letter dated August 17, 2021, and seen by Business Standard.

“Accordingly, we request your good offices to direct the Indian Stock Exchanges to withdraw the Observation Letters with immediate effect.”

“The purpose of this letter to Sebi is primarily to put on record Amazon's position after  Supreme Court’s Judgement this month that stalled  RIL-Future deal and withdraw the Observation Letters that gave approval for the deal to go ahead,” said Salman Waris, managing partner at technology law firm TechLegis Advocates and Solicitors.

Amazon said that in the Observation Letters, the Indian stock exchanges had communicated a conditional approval in respect of the Draft Composite Scheme of Arrangement between Future Group companies and Reliance Group companies and their respective shareholders and creditors.

Interestingly, Future Retail filed a new case against Amazon.com Inc at the Supreme Court in its latest attempt to get clearance for its $3.4 billion deal which the American e-commerce firm has challenged.

In its more than 6,000 page filing, Future has reportedly argued that if the deal with Reliance doesn't go through, it would cause 'unimaginable' damage to the group.

This includes possible job losses for 35,575 employees.

This also put at risk the $3.81 billion in bank loans and debentures.