Future Retail's independent director Ravindra Dhariwal said the independent directors of the company's board are collating information to expose the details of contradiction and misrepresentation made by Amazon before the Competition Commission of India (CCI).
“We are going out to point exactly to CCI, this is what they have told you and this is what the internal documents are saying. We are going to expose the details of contradiction and details of misrepresentation, which they have made,” says Dhariwal.
On being asked why the directors were raising the issue almost three years after the deal, Dhariwal stated that it was only now the e-commerce giant's intent came out in public. He added that this was after the submission made by the e-commerce major before the arbitration proceedings in Singapore at the SIAC.
Earlier, they have always represented that they have no interest in Future Retail Ltd (FRL), he added. According to him, the independent directors have an obligation towards the protection of the ordinary shareholder of the company, lenders and bankers, employees and small stakeholders.
In November 2019, Amazon had acquired a 49 per cent stake in Future Coupons Pvt Ltd (FCPL), a company that holds a stake in FRL. CCI had given its approval for Amazon to acquire stake.
Earlier this week, the independent directors of FRL approached the CCI, urging it to revoke the approval it had given to the Amazon-FCPL deal in 2019, alleging the e-commerce major of “making false statements before it”.
“CCI would have become wary and forwarded the papers to DEA (Department of Economic Affairs) for examination if the acquisition of controlling rights is allowed under FEMA regulations,” they had said. Further, according to the independent directors, Amazon cleverly defended the CCI from doing this and sheltered itself with the notion that its investment in Future Coupons is via an automatic route.
FCPL is a shareholder in Future Retail and the e-commerce major Amazon is contesting the Rs Rs 24,713 crore deal announced last year by Future Group for sale of the retail and wholesale business, and the logistics and warehousing business to Reliance Retail Ventures Ltd, a subsidiary of Reliance Industries Ltd.
While defending FRL’s deal with Reliance, Dhariwal said Amazon was aware of the discussions going on with billionaire Mukesh Ambani-led conglomerate
Dhariwal further said, "The independent directors are not beholden to Amazon or Reliance or any promoters."
Amazon has told FRL to go ahead with the deal and in the negotiation process, they constantly maintained that they knew about the Reliance discussion going on.
The independent directors cleared the Reliance deal only after FCPL, in which Amazon is 49 per cent equity holder, gave the green signal.
Amazon is contesting the deal through its shares in FCPL and had approached Singapore International Arbitration Centre (SIAC). The companies have also approached Indian courts in this matter. In October last year, an interim award was passed by the EA (the emergency arbitrator) in favour of Amazon that barred FRL from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party/
This was also upheld by SIAC last month which said FRL is a party to the ongoing arbitration between Amazon and Future group in the dispute over the sale of its assets to Reliance Retail.
(With inputs from PTI)