Stock Futures – Kishore Biyani says RIL saviour, Amazon didn’t help Future Group despite reaching out to them 8 times

New Delhi: As Future Group and Amazon are locked in a legal battle after the US-based online retail titan took Future Retail into an emergency arbitration over alleged breach of contract, Kishore Biyani—the founder and CEO of Future Group—revealed that he had approached Amazon eight times but it was not open to helping financially-troubled Future, even when lenders invoked shares.

It is worth noting compounded by the Covid-19 crisis, Biyani was compelled to sell his chain of retail stores, warehousing and logistics businesses to Reliance Retail Ventures (RRVL), the retail arm of Mukesh Ambani-controlled Reliance Industries (RIL), for Rs 24,713 crore last year.

More importantly, Biyani said Reliance Retail came as a “saviour” as the asset sale was a crucial bailout deal, mentioning that Amazon wants “the company to languish.” The Jeff Bezos-controlled company is now trying to derail the Indian retailer’s acquisition by Reliance Retail.

In an exclusive interview to ET, Biyani said: “We also connected them with four-five investors but they never showed any interest in salvaging us and were only doing lip service. What is their intention? They want all employees, suppliers, vendors and lenders to suffer and the company to languish.”

The Future boss spilled the beans in his first interview after agreeing to sell all retail assets to Reliance, saying, “As part of the agreement, they could have provided us funds through affiliates or financial institutions by taking over loans from existing lenders but they never did despite the agreement clause and our request.

The financial daily quoted Biyani, the retail czar of India, as saying the Future Group had informed the Amazon about the deal with Reliance several times and they always backed and were “never averse to the same.”

The Indian retailer even held discussion with Witzig Advisory Services, Amazon’s joint venture company with Samara Capital, but the US-based company still didn’t come for help. By March-end, promoter pledging rose to as high as 80-99% in all listed Future Group companies. Stock prices plummeted by more than 70 per cent in just a month, adding to selling pressure.

“They had the right to buy shares and become majority investors in three to 10 years. But once the promoter shares were invoked, even that was not possible and that’s when they should have helped us and replaced lenders. The Reliance deal was a saviour for us and the employees, stakeholders, shareholders and creditors,” the publication quoted Biyani as saying.

Earlier, Future Retail had asked the Securities and Exchange Board of India (Sebi) to review and give approval to its deal with Reliance Retail as soon as possible. The retail company wrote a letter to the market regulator citing the Delhi High Court judgment that the FRL board’s decision to allow the merger of listed entities and sell retail assets to RIL was valid under Indian law.

Putting all speculation to rest, Biyani said he has not made a single penny from the transaction but has lost his retail business and right to be in retailing space. “Still, I am faced to fight with a $2 trillion behemoth. If there is a dispute, it is between the promoters and Amazon and why should they drag my listed companies where they have no say,” he told the daily.

In 2019, the American company had agreed to buy 49 per cent of Future Coupons with the right to buy into FRL (Future Retail Ltd) after a period of three to 10 years. Future Coupons owns 7.3 per cent equity in FRL.

Amazon alleges Future Retail of breaching takeover norms, disregarding the award of the Singapore International Arbitration Centre (SIAC) and acting against the small stakeholders of Future Group in order to benefit group promoter Biyani.