Mukesh Ambani scraps $3.2 bn deal that set up clash with Amazon chief Jeff Bezos
Billionaire Mukesh Ambani abandoned a plan to buy a teetering Indian retailer amid protracted legal challenges from Amazon.com Inc., potentially ending one episode of the broader clash between the two titans to control the country’s billion-people-plus market.
In a filing Saturday, Reliance Industries Ltd. said its proposal to acquire certain assets of Mumbai-based Future Group -- which ran the nation’s biggest retail grocery chain before the pandemic struck -- “cannot be implemented” after its flagship firm Future Retail Ltd. failed to win the approval of its secured creditors for the deal. Reliance didn’t elaborate.
Future Retail’s shares slipped as much as 5.1% in Mumbai on Monday, extending this year’s plunge to 45%. Reliance fell as much as 1.8%, compared to a 1.4% drop in the benchmark S&P BSE Sensex Index.
Ever since Reliance announced the plan in August 2020, to purchase Future’s core units for 247.1 billion rupees ($3.2 billion), the indebted retailer has found itself at the center of a battle between Ambani and Jeff Bezos. Amazon has fiercely contested the takeover by Ambani, arguing in several courts that contractually it had the first right of refusal to buy Future.
Adding Future’s Big Bazaar brand of stores to its assets would have helped Seattle-based Amazon to expand its brick-and-mortar footprint across the country. Similarly, Ambani was counting on the retail, wholesale, logistics and warehousing units of Future to expand the operations of Reliance Retail Ventures Ltd. -- part of a broader pivot from the group’s main oil refining and petrochemicals businesses.
Reliance’s decision to back out also comes after almost two years of tortuous litigation in various courtrooms across India and Singapore that
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