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Bangalore/Mumbai: Amazon.com Inc., which is trying to stop India’s richest man from taking over a struggling retail chain, launched a new defense alleging money from a local firm was possibly passed on to other companies.
Future Retail Ltd. in the form of capital advance to a company controlled by its founder Kishore Biyani in the year ended March 2020 and in the form of payment for goods and services purchased from the firm concerned, Amazon said in a letter. by Bloomberg News. Amazon said that Future Retail also created unusual rental security deposits and made advances to suppliers totaling 43 billion rupees in the same year, even as business declined and stores were closing.
“Significant amounts may have been sourced from Future Retail,” Amazon said. By opening at least part of these transactions, Future Retail can “immediately partially repay outstanding loans to banks and creditors to ensure business continuity and survival,” it added.
The transactions were part of a public disclosure made by the company as part of standard governance practices, a representative for Future Retail said by email, adding that “nothing new is being brought to attention, except for a select few.” Apart from the false speculations being made by. Excerpt.” An Amazon India representative declined to comment.
The US giant demanded an inquiry into a copy of its letter to the Indian finance minister, central bank governor, capital markets regulator and other officials.
A probe could delay the planned acquisition of Future Retail by Mukesh Ambani’s Reliance Industries Ltd, which would make it harder for the tycoon to grow its footprint. Ambani and Amazon are locked in a battle for dominance of the world’s largest market, which is open to foreign competition, with courts in India and abroad as well as the country’s regulators fighting.
The November 24 letter comes as India’s antitrust authority is hearing a plea by Future Retail to revoke regulatory approval of a 2019 deal between one of the group companies and an Amazon entity The US retailer is said to have lied to the regulator. Amazon says Future Retail’s plan to sell its stores to Reliance — Amazon’s rival — breaches the 2019 partnership contract, while the indebted Indian conglomerate says it will collapse if the transaction fails. bloomberg
Read also: This is how Mukesh Ambani is planning to hand over the Reliance Empire to his heirs.
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