Mumbai: The merger of Reliance Industries Ltd (RIL) with Reliance Petroleum Ltd (RPL) will enhance value for shareholders of both the firms and is a major step towards creating one of the largest petrochemical firms of the world, RIL chairman and managing director Mukesh Ambani said.

Commenting on the merger, Ambani said, “this merger follows Reliance Industries’ philosophy of creating enduring value for all our shareholders. It is a significant step in our goal to be among the largest global corporations”.

The board of directors of RIL and its refinery subsidiary RPL on Monday approved the merger of the two firms, creating one of the world’s largest petrochemical entity and offered the shareholders of RPL one RIL share for every 16 shares held by them.

Pursuant to the said merger, RIL’s holding in RPL would be cancelled and RIL would issue 6.92 crore new shares thereby increasing its equity capital to Rs1,643 crore.

Besides, this would result in a 4.4% increase in equity base from Rs1,574 crore to Rs1,643 crore.

Accordingly, the promoter holding in RIL would reduce from 49% to 47%.

Upon the completion of the merger, RIL would have as many as 3,7 million shareholders.