The bonhomie between Reliance Industries Ltd (RIL) and Kishore Biyani-led Future group can be seen in not just the deal they had signed and their fight against Amazon, but in other ventures as well. Just when Future 7-India Convenience Ltd, a unit of Future Retail Ltd, cancelled its deal with 7-Eleven Inc, RIL subsidiary Reliance Retail Ventures Ltd entered into a master franchise agreement with the US-based convenience-retailer.
In a regulatory filing on Wednesday, Future Retail says its subsidiary and 7-Eleven have mutually terminated the agreement to execute 7-Eleven stores in India. "The master franchise agreement was originally executed for developing and operating 7-Eleven stores within India. The termination has been with mutual consent as Future-7 could not meet the target of opening stores and paying franchise fees. The company had no financial or business impact as this arrangement was at the subsidiary company level," Future Retail says.
The next day, Reliance Retail Ventures says that its wholly-owned subsidiary, 7-India Convenience Retail Ltd, has entered into a master franchise agreement with 7-Eleven to launch 7-Eleven convenience stores in India.
A release says, "The first 7-Eleven store is set to open on Saturday, 9 October 2021 at Andheri in Mumbai. This will be followed by a rapid rollout in key neighbourhoods and commercial areas, across the greater Mumbai cluster to start with."
Future Retail is fighting a bitter war with Amazon over its Rs24,731 crore deal with Reliance Retail Ventures. However, while the case is being heard in courts, Future Retail is paving the way for Reliance Retail Ventures to takeover its deals with other parties. The case of 7-Eleven stores ratifies the camaraderie between the two groups.
Last month, the Supreme Court (SC) stayed all proceedings before the Delhi High Court (HC) on Amazon's petition seeking enforcement emergency award passed by Singapore International Arbitration Centre (SIAC), which restrained Future Retail from going ahead with its deal with Reliance Retail Ventures.
In its order, a bench headed by chief justice NV Ramana and comprising justice Surya Kant and justice AS Bopanna says, "stay all further proceedings before the Delhi High Court and all other authorities - Competition Commission of India (CCI), National Company Law Tribunal (NCLT) and Securities and Exchange Board of India (SEBI) - not to pass any final order for four weeks."
The apex court has scheduled the hearing this month - awaiting SIAC's decision on Future Retail's objection to proceedings by Amazon.
On 17th August, the Delhi HC asked Future Retail to implement the earlier single-judge bench order restraining it from going ahead with the deal. The HC passed the order while e-commerce giant Amazon, seeking enforcement of the award by SIAC, restraining the Future group company from its deal with Reliance Retail Ventures.
However, Future group filed a new case against Amazon.com at the Supreme Court. In its over 6,000-page filing, the Kishore Biyani group company contended that if the deal with Reliance Retail fails to go through, it would cause 'unimaginable' damage to Future group, including possible job losses for 35,575 employees, and put at risk roughly Rs280 billion (about $3.81 billion) in bank loans and debentures. (Read: Future Retail Files Fresh Case Against Amazon in SC over $3.4 billion Retail Deal
In February this year, Amazon reached the apex court after the Delhi High Court stayed implementing the status quo ordered by a single-judge bench on the Rs24,713-crore deal between Future Retail and Reliance Retail Ventures. A week before that, the HC had turned down a request from Amazon.com NV Investment Holdings to suspend the order for a week.
A division bench of chief justice DN Patel and justice Jyoti Singh observed that Future Retail was not a party to an arbitration agreement with Amazon. The court prima facie opined that the 'group of companies' doctrine could not be invoked in this matter.
After this, Amazon approached the Supreme Court, contending that the division bench at Delhi HC should have waited for a detailed single-judge order while urging the apex court to stay in this order.
In August 2020, Kishore Biyani and Future group had entered a Rs25,000-crore agreement with Reliance Retail. As part of the pact, Future group was to sell its retail, wholesale, logistics and warehouse businesses to Reliance Retail Ventures.