After Jio, global investment firm KKR invests Rs 5,500 cr in Reliance Industries arm RRVL for 1.28% stake

Business
Typography

This investment values Reliance Retail at a pre-money equity value of Rs 4.21 lakh crore

Mukesh Ambani-led Reliance Industries announced on Wednesday that global investment firm KKR will invest Rs 5,550 crore in its arm Reliance Retail Ventures Limited (RRVL) for 1.28 per cent stake.

This investment values Reliance Retail at a pre-money equity value of Rs 4.21 lakh crore. KKR’s investment will translate into a 1.28 per cent equity stake in RRVL on a fully diluted basis, Reliance Industries said.

This is the second investment by KKR in a subsidiary of Reliance Industries (RIL), following a Rs 11,367 crore investment in Jio Platforms announced earlier this year.

Reliance Retail Limited, a subsidiary of RRVL, operates India's largest, fastest growing and most profitable retail business serving close to 640 million footfalls across its 12,000 stores nationwide.

Reliance Retail’s vision is to galvanise the Indian retail sector through an inclusive strategy serving millions of customers by empowering millions of farmers and micro, small and medium enterprises (MSMEs) and working closely with global and domestic companies as a preferred partner, to deliver immense benefits to Indian society, while protecting and generating employment for millions of Indians.

Reliance Retail, through its new commerce strategy, has started a transformational digitalisation of small and unorganised merchants and is committed to expanding the network to over 20 million of these merchants. This will enable the merchants to use technology tools and an efficient supply chain infrastructure to deliver a superior value proposition to their own customers.

Early this month, US-based private equity firm Silver Lake had announced to invest Rs 7,500 crore in RRVL for 1.75 percent stake.

On the deal, RIL CMD Ambani said, “I am pleased to welcome KKR as an investor in Reliance Retail Ventures as we continue our onward march to growing and transforming the Indian retail ecosystem for the benefit of all Indians. KKR has a proven track record of being a valuable partner to industry-leading franchises and has been committed to India for many years. We look forward to working with KKR’s global platform, industry knowledge and operational expertise across our digital services and retail businesses.”

Henry Kravis, co-Founder and Co-CEO of KKR, said, “We are pleased to deepen our relationship with Reliance Industries through this investment in Reliance Retail Ventures, which is empowering merchants of all sizes and fundamentally changing the retail experience for Indian consumers. Reliance Retail’s new commerce platform is filling an important need for both consumers and small businesses as more Indian consumers move to shopping online and the company offers tools for Kiranas to be a critical part of the value chain.”

Reliance Industries has been aggressively expanding its footprints in the domestic retail sector as it looks to attract potential investors over the next few quarters.

Last month, Reliance Industries purchased the retail, wholesale, logistics and warehousing businesses of Future Group for Rs 24,713 crore.

Image credit: File photo

All Comments