Reliance Industries (RIL) share price zoomed up by over 3 percent in the morning session on November 23 after CCI gave a nod to the Future Group-Reliance Retail deal. The Competition Commission of India (CCI) on November 10 approved the acquisition of retail, wholesale, logistics, and warehousing businesses of Future Group by Reliance Retail Ventures Ltd (RRVL) and Reliance Retail and Fashion Lifestyle Ltd. Share price of Future Retail rallied up 10 percent and hit upper circuit of Rs 79 per share on BSE.
Earlier on August 29, 2020, Mukesh Ambani-led Reliance Industries had made the news of acquisition of businesses of Kishore Biyani’s Future Group for Rs 24,713 crore public. The announcement was a huge blow to Amazon.com which had asserted that Future Group violated its agreement with the US e-commerce giant by entering into the deal with RIL.
Singapore International Arbitration Centre (SIAC), on October 25, had passed an interim order in favour of Amazon prohibiting FRL from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party. Subsequently, Amazon also appealed to market regulator SEBI, stock exchanges, and CCI, urging them to take into consideration the Singapore arbitrator’s interim decision as it is a binding order.
Later, Kishore Biyani-led Future Retail Ltd (FRL) on November 7 approached the Delhi High Court against Amazon.com for meddling in its Rs 24,713 crore deal with Reliance Industries (RIL) by misusing the arbitration order passed by SIAC. CCI gave a green signal to the acquisition after checking all legalities, said sources close to the deal. “The outcome of the arbitration doesn’t hold any ground in India after the CCI approval,” a corporate executive said.
Reliance will be paying Rs 24,713 crore for key formats of Future group such as Big Bazaar, FBB, Foodhall, Easyday, Nilgiris, Central, and Brand Factory, besides the Kishore Biyani-led conglomerate’s logistics and warehousing business. It will take over certain borrowing and liabilities, the companies said. The acquisition is being done as part of a scheme in which Future Group is merging certain companies carrying on the aforesaid businesses into Future Enterprises Ltd (FEL).
