Mukesh Ambani’s Reliance Industries is in talks to sell equity stake worth $1 billion in Reliance Retail to US-based private equity firm Silver Lake, in a deal that could value Reliance Retail at $57 billion, the Financial Times reported citing unidentified sources. FT reported that Mukesh Ambani is looking to raise $5.7 billion from investors by selling a 10% stake in Reliance Retail. Earlier this year, Silver Lake bought a total of 2.08% equity stake in RIL’s telecom and digital services unit Reliance Jio for Rs 10,202 crore. RIL ended up selling a total of 32.97% stake in Reliance Jio Platforms for Rs 1.52 lakh crore to 13 investors, Facebook, Google, Qualcomm, KKR, and more.
Mukesh Ambani’s Reliance Industries Ltd (RIL) is India’s largest private listed company with a market capitalization of Rs 13.91 lakh crore (about $189 billion). Silver Lake’s investments in Jio Platforms valued it at about $66 billion. Silver Lake’s investment in Reliance Retail at a valuation of $57 billion would take the combined valuation of Jio Platforms and Reliance Retail to $123 billion. Reliance Retail had a total turnover of Rs 162,936 crore and a net profit of Rs 5,448 crore at the end of the previous fiscal year.
According to market participants, Mukesh Ambani has been working to pose RIL as a technology and retail play as its traditional cash cow, the oil-to-chemical business witnesses a slowdown owing to the global pandemic.
The company last week acquired Kishore Biyani’s Future Group’s retail, logistics, warehousing and wholesale businesses in a slump sale worth Rs 24,713 crore. With the recent acquisition of Kishore Buyani’s Future Group business, Mukesh Ambani looks to take on global e-commerce giants such as Amazon, Walmart owned Flipkart. Reliance Retail, with the assets acquired from Future Group has become a leader in India’s retail space, pushing Radhakishan Damani owned Avenue Supermarts to a distant second.
FE Online has sent a query to Reliance Industries spokespersons, and will update the story with their response.
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