New Delhi, May 29 (IANS) Amazon (NASDAQ: AMZN ) caused the downfall of Future Retail Limited (NS: FURE ) (FRL) when it could not buy its assets on the cheap, placing FRL now on the brink of bankruptcy, the independent directors of FRL have said.
In a reply to Amazon, the directors said in a letter, "Your feigned concern over the state of affairs in FRL is a falsehood and an attempt to gloss over this inconvenient truth."
"Your letters are not motivated by the concern or interest of FRL stakeholders, but only as a self-serving act to destroy FRL at any cost," they added.
"It is strange that you (Amazon) are now making these allegations against FRL and the independent directors, whose every action during the relevant period has been in bona fide discharge of their fiduciary duty to safeguard the interests of FRL, its shareholders and employees.
"These efforts of the independent directors have been frustrated solely on account of Amazon's unlawful and mala fide interference with FRL's business and its sustained efforts to destroy the company," they added.
There has been no failure by independent directors to discharge their obligations under law or otherwise, they claimed.
"Your allegations that independent directors facilitated the stratagem and aided and abetted the so-called fraud to handover the stores to Reliance (NS: RELI ) is false to your knowledge, and a narrative now being created by you to carry on your battle with Reliance using FRL as a pawn," the letter said.
The independent directors of FRL said that the facts that have come on record and which will surely be looked into by the Indian regulators in due course will expose how Amazon has been playing the system in India.
"Amazon has financial interests in a host of companies and uses them to bump off successful traders on its platform and exploit the goodwill built by them. The nonsensical basis on which this is done is by suggesting that a subsidiary company is not a group company. It is Amazon's business model that calls for an investigation," they added.
Amazon's suggestions that FRL has paid $14 million to bond holders and hence it is not in financial difficulties and that FRL should have paid all lease rentals due to Reliance (when the fact is that it could not make any payment to Reliance) are absurdities, the independent directors said.
It is a known fact that FRL has defaulted in servicing of its loans, payments to creditors and is on the verge of being admitted to bankruptcy. It is a bitter irony that Amazon, the cause of the present state of affairs, is feigning ignorance of the acute financial distress of FRL, the letter said.
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It is heartning that off late series of such incidence had happened where general public has lost their hard earned money in such feud. Few to name are HDIL, DHFL, Yes Bank, etc which is also indication of inability to take timely appropriate action on regulator’s end. Not a good signLike 0
Indian regulators should deep down the issues and conduct an unbiased investigation to find real culprit. Wealth destruction in this way is a matter of national interest as public money is involved.Like 0