This marks the second significant investment by Mubadala in a Reliance Industries subsidiary after $1.2 bn investment in Jio Platforms announced earlier this year
Abu Dhabi-based sovereign wealth fund Mubadala picked up 1.4 % stake in Reliance Retail Ventures (RRVL), a subsidiary of Reliance Industries Limited, for ₹6,247.5 crore, the company said in a statement.
The investment values Reliance Retail at a pre-money equity value of ₹ 4.285 lakh crore. "Mubadala’s investment will translate into a 1.40% equity stake in RRVL on a fully diluted basis," RIL stated in its regulatory filing.
This marks the second significant investment by Mubadala in a Reliance Industries subsidiary after the US $1.2 billion investment in Jio Platforms announced earlier this year.
Reliance Retail Limited, a subsidiary of RRVL, operates India’s fastest growing and most profitable retail business serving close to 640 million footfalls across its approximately 12,000 stores nationwide.
Commenting on the investment Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said, “I am happy to welcome Mubadala as a valued investor in Reliance Retail Ventures. We value the partnership with a knowledge-rich organization like Mubadala and acknowledge their confidence in our mission to strengthen the core of India’s retail sector – the millions of small retailers, merchants and shopkeepers – through the power of technology. Mubadala’s investment and guidance will be an invaluable support in this journey."
Khaldoon Al Mubarak, Managing Director and Group CEO, Mubadala Investment Company, said, "We are pleased to deepen our relationship with Reliance Industries through this investment in Reliance Retail Ventures. Their vision is the inclusive transformation of India’s consumer economy through the power of digitization, creating opportunities and market access for millions of small businesses across the country, and we are committed to supporting the company’s continuing development."
Mubadala is the second-biggest state investor in Abu Dhabi after Abu Dhabi Investment Authority, managing about $240 billion in assets.
The transaction is subject to regulatory and other customary approvals.
Morgan Stanley acted as financial advisor to Reliance Retail and Cyril Amarchand Mangaldas and Davis Polk & Wardwell acted as legal counsels.
This is cheque number five for Reliance Retail after Silver Lake's additional ₹1,875 crore and earlier's ₹7,500-crore investment for a 1.75% stake, KKR's ₹5,550-crore investment for a 1.28% stake and General Atlantic's ₹3,675-crore investment for 0.84% stake.
Reliance has since September raised ₹24,847.5 crore by selling 5.65% in its retail arm.
Following the sell-down in its digital unit Jio Platforms, Reliance's focus has shifted to retail with the acquisition of Future Group's businesses and investment by global private equity firms/strategic investors.
All 13 investors who had poured in a combined ₹1.52 lakh crore in Jio Platforms have been offered a chance to explore investing in the retail unit.
Ambani's push to seek investments in its retail business come as the oil-to-telecoms Indian conglomerate has been looking to expand its e-commerce operations to compete against Walmart's Flipkart and Amazon.com's Indian business.
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