Future has called a general meeting for April 20th and the creditors’ meeting for April 21st
Future has called a general meeting for April 20th and the creditors’ meeting for April 21st
Amazon has created Future Retail Ltd. (FRL) warned it would hold meetings of its shareholders and creditors next week to approve the sale of its retail assets to billionaire Mukesh Ambani’s Reliance Retail.
In a 16-page letter to Kishore Biyani and other promoters on April 12, the US e-commerce giant said such meetings are illegal and not only violate agreements made in 2019 when Amazon invested in FRL’s promoter company , but also violated an injunction by a Singapore arbitration tribunal in the sale of retail properties to Reliance.
The letter, signed by a representative of Amazon.com NV Investment Holdings LLC, urged the Biyani Group to strictly comply with the injunctions issued by the notary arbitrator and “ensure that no further steps are taken to proceed with the transaction.”
Future has called a shareholders’ meeting for April 20 and a meeting of creditors for April 21 to seek their approval of the proposed ₹24,713 crore deal with Reliance.
The move follows a Feb. 29 decision by the National Company Law Tribunal (NCLT), in line with a Supreme Court ruling dated Feb. 15 that allowed Future Group companies to call a shareholders’ and creditors’ meeting.
However, Amazon considers such meetings to be illegal.
“Any attempt to refute the injunctions and vote on the basis of forged documents, given Amazon’s categorical denial that neither the directors of Future Coupon Pvt. ltd (FCPL) nor representatives of FCPL has given its consent or the organizers would amount to becoming aware of a forged document with intent to deceive and defraud, making all parties, whether acting directly or facilitating such action, liable under the Laws would do,” it said.
Amazon is opposed to Reliance’s August 2020 bid to buy Future Retail’s stores and warehouses for £24,713bn, saying the deal violated its 2019 agreement, which gave it a 49% stake in FCPL, Future Retail’s funding body, for about £1,500 crore.
It has taken Future to arbitration and court to block the Reliance deal.
Reliance quietly began taking over the leases for hundreds of stores once operated by Future Retail and Future Lifestyle Fashions Ltd in late February amid court cases and arbitrations across India and Singapore.
“It is once again noted that any vote in favor of the Program or any action taken to promote or endorse the Program without the consent of Amazon would be made by any director, authorized agent, agent or agent on behalf of the Promoters, Promoter Entities or FCPL as express breach by the Promoters and FCPL of any valid and binding injunction against them,” Amazon wrote.
The US giant said FCPL and FRL’s sponsors are barred from taking any steps to promote the Reliance deal because the Delhi High Court has not issued an order allowing meetings of shareholders and creditors to be convened.
“In relation to the FCPL Shareholder Agreement (SHA) and the FRL-SHA (both agreements entered into by the Promoters and FCPL), various commitments and commitments have been made by the Promoters including that they will retain administration and control of FRL.
“Furthermore, pursuant to the above agreements, the retail assets of FRL have been entrusted to the promoters on the express condition that the retail assets may only be disposed of in the manner prescribed in the agreements and in any event never to a restricted person,” it said.
According to Amazon, Reliance has been classified as a disabled person.
“Furthermore, as part of the terms of the Entrustment, the Promoters and FCPL have agreed not to act without Amazon’s consent with respect to the matters set forth in the Agreements,” it said, adding that Amazon has not consented to any transaction or approved any restricted transaction Person.
“It is reiterated that the proposed transaction with Mukesh Dhirubhai Ambani Group will result in the cessation of operations and existence of FRL itself and the transfer of FRL’s retail assets to a restricted person, thereby destroying the basis of Amazon’s investment and its protection and material rights,” she wrote. Pt
