There are usually two answers to the question of who controls a company. 

One answer is whoever controls the stock of the company. Maybe it’s the shareholders or the board of directors or a trust. Or one could argue that maybe it’s the company’s stakeholders, like the employees or customers or lenders. This answer is based on the idea of legality, which in itself is an abstract construct created by us to define the ownership of a company, also another imaginary construct.

The second, more practical answer to the question is—whoever has the keys to the company building. I mean, yes, the board of directors can pass any number of resolutions to demand that the keys be handed over. But until it’s done, the person who holds the keys controls the company. 

The reason I’m talking about this is because this answer is central to who gets to become India’s largest retail company—Amazon or Reliance. 

Both companies have made ownership claims over Future Group, the country’s second largest retail chain, and after a bloody and complicated three-year-long war, the matter is now being heard by the Supreme Court of India. 

Amazon’s claim to ownership rests primarily on paper. Specifically, on a signed contract. India has fairly restrictive laws around foreign direct investment into offline retail companies, but Amazon, through some amazing legal manoeuvres, found a way to technically take control of Future Group. I wrote about this in detail a few months ago, and how Amazon “threw a handkerchief on a seat through the window on the Future Group train”. If you want to understand what’s going on, I recommend reading that piece first. It’s a great summary of how smart Amazon has been. 

Reliance has legal arguments of its own too, based on another set of contracts. 

But with one key difference—Reliance also owns the keys to the building. 

In terms of legal brilliance, I was convinced that it would be hard to top what Amazon had done. 

But that was before we understood what Reliance did.

Because that is just something else altogether. 

And makes for an even better story. 

Let’s dive in. 

This was Amazon’s brilliant move to control an offline retail company, without technically owning it, which it believed was perfectly legal. 

Then the pandemic hit, and as stores all across the country shut, it pushed Future Group deeper into debt. The company came under pressure from lenders. Future Group claims to have asked Amazon for help, but no assistance was provided. 

Enter Reliance, which had announced that it was acquiring Future Retail in a deal worth Rs 24,000 crore ($3.4 billion). 

And that was when everybody lost their collective minds. 

A lot of complicated legal lawsuits and counter-lawsuits across several courts in multiple countries happened after this deal was announced, and quite frankly, I doubt anybody will be able to explain it with any degree of certainty, not even the company’s lawyers. Amazon dragged Future Group over breach of contract to the Singapore International Arbitration Centre, or the SIAC, and got a ruling in its favour. Then there were other lawsuits filed at the Delhi High Court. Then other agencies got involved. The Enforcement Directorate. Securities and Exchange Board of India. The Competition Commission of India. The National Company Law Tribunal. 

Quite frankly, after reading up on all the orders that were stayed, upheld, transferred and denied, I had to lie down and take a short nap. I doubt that there are any lawyers left in India who aren’t involved in some way in this dispute. It’s that messy.

It seemed like this would be a long, prolonged, legal battle.

Except one company had other plans. 

On the night of February 25, without any warning, Reliance launched a stunning move.

It just showed up and physically took control of Future Group stores across the country. 

Here’s an account of what happened that night, as reported by Reuters.