Future Retail’s Lenders Want to Sell Chain’s Assets

Lenders to the Indian department store chain Future Retail have told the country’s Supreme Court that the chain’s assets should be auctioned off to cover missed payments.Lenders to the Indian department store chain Future Retail have told the country’s Supreme Court that the chain’s assets should be auctioned off to cover missed payments.

It was the latest wrinkle in an ongoing legal battle between Future and Amazon, which purchased a stake in the company in 2019.

As Reuters reported Thursday (Feb. 3), the lenders also say they’ve begun classifying loans to the retailer — the second-largest in India — as non-performing and would need to make combined provisions of 80 billion to 90 billion rupees (or $1.1 billion to $1.2 billion) because of the chain’s non-payment.

“Let it be subjected to an open bid… This is the only solution,” Rakesh Dwivedi, an attorney representing about 30 of Future’s lenders, told the Supreme Court judges, citing the ongoing litigation between Future and Amazon.

From there, Dwivedi added, Amazon and Reliance — another company hoping to purchase Future Retail — could bid on the chain’s assets. Reuters notes that the court has not ruled on the matter. Future has declined to comment.

Future had been planning to sell its retail assets to Reliance for $3.4 billion, only to have the sale blocked by Amazon in arbitration and in court, with the retail giant arguing Future violated non-compete contractual terms.

Future has said it couldn’t pay the 35 billion rupees ($470 million) owed to lenders as the legal battle with Amazon prevented it from selling some of its smaller stores.

Read more: Delhi High Court Denies Future’s Push to Rule Amazon Arbitration Illegal

Last month, Future Retail asked a court in New Delhi court to declare the arbitration proceedings with Amazon illegal, arguing India’s antitrust agency had suspended the 2019 deal that Amazon used to assert its power over Future before it was factored into the arbitration. The court ultimately dismissed the retailer’s request.

The Competition Commission of India suspended Amazon’s 2019 deal with Future late last year, saying Amazon had held back information while seeking approvals for the agreement.

The arbitration between Amazon and Future is being handled by a panel in Singapore, but both sides have also been fighting a legal war in India to seek enforcement or overruling on some of the decisions taken by the arbitrator.