Future Retail moves Supreme Court to stay HC orders, says if not liquidation inevitable
Kishore Biyani-led Future Retail on Saturday said it has approached the Supreme Court against orders passed by the Delhi high court to maintain a status quo in relation to its Rs 24,713-crore deal with Reliance Retail and directing it to enforce the order of the Singapore-based Emergency Arbitrator.
In a regulatory filing, Future Retail said, “Please be informed that the company has filed a special leave petition before the Hon’ble Supreme Court of India against the impugned orders dated February 2, 2021, and March 18, 2021, passed by ‘Ld. Single Judge’...The SLP will be listed for hearing in due course.”
In its petition, the company stated that “here is extreme urgency to hear” and “stay the impugned orders” passed by the single-member bench of the Delhi high court, failing which the company would go into liquidation.
Future Retail, in its petition, said the scheme of amalgamation, which will be listed before the NCLT, cannot go through due to the orders of the high court.
“... and as a result of which the scheme which benefits all the stakeholders, including the public at large and various public sector banks may fall through; If the scheme falls through, it is inevitable that FRL will go into liquidation,” it said.
Besides “approximately Rs 28,000 crore of public money in the form of bank loans and debentures issued by FRL and its group companies will also be at risk”, said the Future group firm in its appeal.
The magnitude of damage that may be caused to the public at large is “unimaginable” as livelihoods of more than 35,575 employees of FRL and various companies that are part of the scheme may be lost, it added.
“The solvency of over 8,050 SMEs (excluding SMEs of Future Enterprises Limited) and their employees is at stake.
The scheme, filed before the Mumbai bench of the NCLT, entails consolidation of Future Group’s retail and wholesale business, and the logistics and warehousing business into one entity (Future Enterprises) and then transferring it to Reliance Retail Ventures under the Rs 24,731-crore deal with RIL.
The deal is contested by Amazon, an investor in Future Coupons that in turn, is a shareholder in FRL.
Amazon, had approached Singapore International Arbitration Centre (SIAC), where an Emergency Arbitrator (EA) had on October 25 last year restrained the Future group from going ahead with its Rs 24,731 crore deal with RIL.
Later, the matter was taken to the Delhi High Court, where on February 2, a single bench of Justice J R Midha had directed FRL to maintain status quo in relation to its Rs 24,713 crore deal with Reliance Retail.
Justice J R Midha said the court was satisfied that an immediate interim order was required to be passed to protect the rights of Amazon.
Later, on March 18, the court upheld the Singapore Emergency Arbitrator's (EA) order restraining Future Retail Ltd (FRL) from going ahead with the Rs 24,713 crore deal with Reliance Retail to sell its business, which was objected to by US-based e-commerce giant Amazon.