Future Retail told to inform NCLT of Amazon’s complaint
Notwithstanding the objections raised by Amazon, the Securities and Exchange Board of India (SEBI) has given it’s nod to the Future Retail and Reliance Retail Ventures deal. In August 2020, Future Retail and Reliance Retail had agreed to a slump sale of assets to the latter for approximately Rs 25,000 crore. This comes even as Amazon has moved an appeal to the Divisional Bench of Delhi High Court opposing the deal.
SEBI has said that Future Retail shall ensure that the details of the complaints made by Amazon and the related legal proceedings should be bought to the notice of the shareholders of the listed entities involved in the scheme while taking shareholder approval on the scheme. “Further the same shall also be brought to the notice of NCLT while filing the draft scheme for their approval,” SEBI said.
In its letter to the Exchanges, SEBI said: “In light of the above, we hereby advise that we have no adverse observations with limited reference to those matters having a bearing on listing/de-listing/continuous listing requirements within the provisions of Listing Agreement, so as to enable the company to file the scheme with Hon’ble NCLT.
“Further, where applicable in the explanatory statement of the notice to be sent by the company to the shareholders, while seeking approval of the scheme, it shall disclose information about unlisted companies involved in the format prescribed for abridged prospectus as specified in the circular dated March 10, 2017,” the regulatory authority added.
SEBI has however said that the both the companies need to get approvals from the NCLT as well as its other stake holders. “The Exchange reserves its right to withdraw its ‘No adverse observation’ at any stage if the information submitted to the Exchange is found to be incomplete / incorrect / misleading / false or for any contravention of Rules, Bye-laws and Regulations of the Exchange, Listing Agreement, Guidelines/Regulations issued by statutory authorities,” it said.
Amazon, which had invested Rs 1,400 crore in FCPL, a gifting arm of the Kishore Biyani-owned Future Group in 2019, had moved an arbitration in SIAC. Post which, it had been granted an interim stay on the said deal.
The deal has already received a nod from the Competition Commission of India. –The Hindu BusinessLine