Amazon has for months blocked the $3.4 billion sale of Future’s retail assets to rival Reliance, announced in 2020, citing a breach of certain contracts. Future denied any wrongdoing, and hopes had risen recently of an out-of-court settlement after Amazon and Future agreed to talks.
On Tuesday, the two sides told India’s Supreme Court, which is hearing the dispute, the talks had collapsed, and Amazon took out newspaper ads criticising both Reliance and Future.
Two sources with direct knowledge of the settlement talks told Reuters that Amazon representatives informed Future the dispute could end if the U.S. company could get back at least $200 million it invested in a Future unit in 2019 – the transaction at the heart of ongoing legal disputes.
Future instead offered a stake of an equivalent amount in one of its remaining group companies after Reliance takes over most of its retail assets, saying it was financially distressed. But Amazon did not accept that, the sources said.
Future and Amazon did not respond to emails seeking comment.
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One of the sources said there were more factors at play during the talks, but Amazon’s demand for the return of investment was the “bare minimum” the U.S. company wanted.
The settlement talks were triggered after Reliance, India’s biggest retailer, stunned Amazon when it began taking over key Future Retail outlets on Feb. 25 with its staff suddenly showing up at many of Future’s biggest stores to assume control, in what was seen as a de facto takeover.
Earlier on Tuesday, Amazon ran large ads in leading Indian newspapers headlined “PUBLIC NOTICE” and alleging actions taken by Reliance and Future had been “done in a clandestine manner.”
Future, which has $4 billion in overall debt, has said it is staring at insolvency if its deal to sell retail assets to Reliance fails.
