Future Retail, India’s second-largest retail chain, is stuck in a bit of a custody battle right now. However, instead of two disgruntled parents vying for custody, it has two multibillion-dollar corporations – Amazon and Reliance Industries. And instead of who gets the house, it’s more like who gets the US$3.4 billion deal standing in the way.
See, Future isn’t doing so hot right now and is basically losing money by the minute. To solve that problem, it was going to sell 200 stores along with some parts of its company for US$3.4 billion to Reliance Industries, an Indian multinational conglomerate owned by Mukesh Ambani.
But, Amazon, who bought a minority stake in Future a few years back, didn’t give the go-ahead on this deal. The company argues that part of the deal when it invested in Future was that it would get the chance to decline any deals like this.
That all happened a while back, and Amazon and Reliance have been in legal battles since. What’s new, though, is that while Amazon was trying to solve the problems in court, Reliance has been buying the properties the Future stores are on and then hiring its employees behind the scenes, effectively buying the stores one-by-one instead of all at once.
So now the two groups have finally decided to sit down and negotiate the path forward for Future.
“We cannot let the spinner’s wheel continue. At least have a conversation,” said Amazon’s lawyer, Gopal Subramanium, to the court.
“What stops Amazon to call Kishore Biyani and discuss. Let me assure you no one is winning in this battle. Amazon ‘God’ has to come to the ground and speak to lesser mortals like us,” said Harish Salve, a representative for Future Group. “No one is winning. FRL, Reliance, and Amazon all have issues. I don’t know why we need a court order for a dialogue.”
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