Amazon's Jeff Bezos and Reliance's Mukesh Ambani are going head to head for India's retail segment. Image: Facebook

E-commerce giant Amazon has once again stepped up its campaign to stop its rival Reliance Group from taking over the troubled offline retailer Future Group.

Amazon has now approached the Indian Supreme Court seeking to stop Future Group’s sale of $3.4 billion in retail assets to Reliance Retail, according to media reports. The proposed sale includes Future Group’s supermarket chain Big Bazaar, premium food supply unit Foodhall and fashion and clothes supermart Brand Factory’s retail and wholesale units.

The move comes days after the Delhi High Court had revoked its earlier single-judge decision that effectively blocked the deal. The high court order was, however, an interim one and the next hearing is on February 26.

Amazon in its petition to the Supreme Court said the high court should have waited for a detailed order of the single-judge bench before removing the hold on the deal. The new order allows procedures before the Competition Commission of India and the Securities and Exchange Board of India to resume. Amazon contends that once this is allowed there could be no return.

The US giant had in 2019 acquired a 49% stake in Future Coupons and by virtue of that obtained a small stake in Future Retail. This deal gave Amazon the first right of refusal during a stake sale. There is also a non-compete clause that prevents Future Group from approaching Amazon’s competitors.

Amazon alleges that Future has violated the contract by agreeing to sell its retail assets to Reliance Industries in August last year. It had approached the Singapore International Arbitration Centre alleging that it breached their 2019 agreement. The Singapore court had on October 25 ordered a stay and told Future Group not to proceed with the sale and await the outcome of the arbitration process. Amazon contended that a decision by the Singapore arbitrator was enforceable under Indian laws.

Future Group had alleged that it had approached Reliance after Amazon failed to help in fighting cash crunch. The retailer had to keep its 1,700 outlets shut for months after the Indian government announced a countrywide lockdown on March 25 to fight the Covid-19 pandemic.

The group’s founder and CEO, Kishore Biyani, had earlier claimed that the company approached Amazon eight times seeking help, but the e-commerce giant did not oblige. Amazon denied the claim and said it had held discussions with partners and the promoters of Future Group to find a solution.

The US e-commerce giant is keen to block the deal as it will give Reliance an unparalleled edge over rivals. Reliance is already the country’s biggest brick-and-mortar retailer and has made ambitious plans for its e-commerce venture JioMart. Its retail arm Reliance Retail is looking to offload 15% stake and has already attracted investments from global private equity majors such as Silver Lake and KKR.