In Blow To Amazon, Regulators In India Approve Reliance Retail Deal

In a big setback for Amazon, the Securities and Exchange Board of India has reportedly approved Reliance Retail’s $3.4 billion acquisition of Future Group’s retail assets. Regulatory battles may remain for the deal.

Amazon had called on the Indian securities board in November to investigate Future over the issue of insider trading.

Amazon had been pushing Indian regulators, including the Bombay Stock Exchange and the securities board, to stop Reliance from taking over Future — a supermarket and high-end food store chain with more than 1,500 locations across India.

The effort to quash the Reliance deal even included a court case in Singapore, in which Amazon claimed the deal breaches prior agreements it had with Future Retail. The eCommerce giant owns a 49 percent stake in Future Coupons, which owns a 7.3 percent stake in Future Retail.

Now, the Indian securities board has approved the deal, The Economic Times of India reported Thursday (Jan. 21), and the Bombay Stock Exchange has said it has no objections to the stock listing request. Among other things, the deal would transfer the retail and wholesale business of Future Group to Reliance Retail and Fashion Lifestyle, a wholly-owned subsidiary of Reliance Retail Ventures.

However, the stock exchange put certain conditions on Reliance. It said the company should ensure that any future disputes, complaints, regulatory proceedings or orders related to the proposed deal should be brought to the notice of shareholders.

Even then, the next step is approval by of India’s National Company Law Tribunal.

And, the news outlet reported, the stock exchange said Reliance should provide shareholders and the regulatory tribunal “the details of the complaints made by Amazon, the submissions of Future Retail Limited and the counter submissions of Amazon and all the proceedings pending and completed in the Delhi High Court and the award of emergency Arbitrator in the Singapore International Arbitration.”

In the byzantine world of Indian regulators, the country’s Competition Commission of India (CCI) has already approved the deal.