Future Group shares tumble after SC rules in favour of Amazon

Shares of Future Group tumbled after the Supreme Court upheld e-commerce giant Amazon’s plea seeking to put on hold the Rs 24,731-crore deal between Reliance Retail and Future Retail.
 
The court said that the Emergency Arbitrator Order is enforceable by Indian laws. The Supreme Court bench asked if the emergency award order is covered within Section 17 (1) and can be enforced under Section 17(2) of the Arbitration Act.
 
Shares of Future Retail declined 10 per cent to hit an intraday low of Rs 52.55 against the previous close of Rs 58.35 on BSE. Market cap of the firm fell to Rs 2,849.70 crore. Shares of Future Lifestyle hit lower circuit of 10% and touched an intraday low of Rs 60.70. Market cap of the firm fell to Rs 1,224.77 crore.
 
Future Retail stock has lost 51 per cent in one year and fallen 33 per cent since the beginning of this year. The share stands lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

The other listed companies of the Group, Future Consumer, Future Enterprises and Future Supply Chain hit their respective lower circuits too.
 
The Supreme Court's two-judge bench of Justices RF Nariman and BR Gavai said today that the Singaporean arbitrator’s decision that stalled the deal between the two retail giants holds merit and Amazon’s objections are valid as well as applicable in the country.
 
Jeff Bezos’ Amazon and Mukesh Ambani’s Reliance Industries have been involved in a legal tussle since the latter signed a deal to acquire Future Group assets. Amazon has accused Future Group of violating pre-existing clauses that give them the right of first refusal. Future has denied wrongdoing.
 
Shares of Reliance Industries ended 2.07 per cent lower at Rs 2,089.05 against the previous close of Rs 2133.30 on BSE. Market cap of the company fell to Rs 13,24,341.36 crore.
 
Amazon had first filed a plea before the high court for enforcement of the October 2020 EA award by the Singapore International Arbitration Centre (SIAC), restraining Future’s deal with Reliance Retail.
 
Around 1,300 of Future's more than 1,700 retail outlets in 400 cities sell groceries. That makes Future a prized asset for both Reliance and Amazon.
 
Future Retail said the SC judgement covers a limited point and that the main dispute is still ongoing before the arbitration tribunal. The company statement said the arbitral tribunal has concluded hearings on two questions -- whether the interim award of the emergency arbitrator should continue and whether FRL is at all a party in the  Arbitration proceedings. "The decision of Arbitral Tribunal is awaited," said the company.