Amazon the e-commerce Gaint’s defeated its primary battle against Future Group. For the time is now, the former will not sell its properties to Reliance Retail. Amazon argues that Future breached the deal with the e-commerce giant it had previously signed, where it was expected to get the right of first refusal to acquire the beleaguered retailer.
But was Amazon genuinely interested in purchasing the entire Future Group is still the question?
Through Future Coupons, where it purchased a 49% stake, Amazon picked up a 1.3% stake in Future Retail last year. This deal, however, is on the brink of collapse now.
Amazon’s interest in taking over the Future Group is now under question. Amazon believed that in the long run Reliance Industries could take over and corner the e-commerce giant.
After the news of the deal being put on hold came out, both Future Group and Reliance Industries share prices plummeted. By the day, the Amazon-Future deadlock is becoming messier. It could take from a few months to a couple of years to get sorted out everywhere.
Future Group, meanwhile, will find it hard to run the company. It is still defaulting on payments and will find it difficult to collect working capital in the absence of creditworthiness.