CAIT files complaint with CCI against Amazon-More deal
Premium- CAIT said that Amazon has taken over More Retail through Samara AIF that owns 51% equity in Witzig Advisory LLP that in-turns owns More Retail Limited
NEW DELHI : Trader’s body Confederation of All India Traders (CAIT) on Monday said it has filed a complaint with the Competition Commission of India (CCI) against Amazon’s investment in food and grocery retailer More.
In 2018—Private equity firm Samara Capital along with Amazon.com Inc., agreed to buy Aditya Birla group’s food and grocery retail chain, More. The acquisition was done through Samara Capital’s arm Witzig Advisory Services Pvt. Ltd. Amazon had bought a 49% share in Witzig Advisory Services. The deal was cleared by the CCI in January 2019.
CAIT said that Amazon has taken over More Retail through Samara Alternate Investment Fund (Samara AIF) that owns 51% equity in Witzig Advisory LLP that in-turns owns More Retail Limited. Amazon got a clearance for this investment from the anti-trust watchdog by “suppression" and “concealment", the traders' association said.
The traders’ body said the investment in More is akin to Amazon’s investment in Future Coupon. In August 2019, Amazon had bought the 49% stake in Future Coupons, which owns a 7.3% equity in Future Retail through convertible warrants, with the right to buy into the flagship Future Retail after 3 to 10 years. To be sure, foreign investment in multi-brand retail in India is restricted.
Amazon has adopted the same structure in acquisition of More Retail as was adopted in the case of Future Retail, CAIT said citing internal Amazon emails. “This confirms that Amazon has committed the same fraud on CCI in the matter of More Retail as was done in the case of Future group," it said.
“As is the case with Future, Amazon has represented to CCI that Amazon has made only a financial investment in Witzig. It has not invested in More Retail; the rights Amazon has acquired over More Retail Limited are only investment protection rights and Amazon has no strategic interest in More Retail," CAIT further added.
Amazon has not given a confirmation that Amazon or its affiliates or its related parties have not invested in Samara AIF, either directly or indirectly, it added.
An Amazon spokesperson said the company has no comments to offer on the development.
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CAIT's petition comes as Amazon and Future Retail have been locked in a bitter legal battle over Reliance Industries Ltd., buying retail assets of the latter.
On Sunday, PTI had reported, citing sources, that Amazon has written to independent directors of Future Retail Ltd, confirming that Samara Capital "remains interested and committed" to invest Rs7,000 crore for buying all retail assets of the company.
CAIT said this offer was “bogus", as investment laws profit foreign companies from owning multi-brand retail companies in India.
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