Reliance Retail Ventures Ltd (RRVL), a subsidiary of Asia’s richest man Mukesh Ambani-controlled Reliance Industries Ltd, (RIL), has raised ₹7,500 crore from American private equity firm Silver Lake.
The investment values RRVL at a pre-money equity value of ₹4.21 lakh crore. Silver Lake’s investment will translate into a 1.75 per cent equity stake in RRVL on a fully diluted basis, the company said in a statement.
This marks the second billion dollar investment by Silver Lake in an RIL subsidiary after the $1.35 billion investment in Jio Platforms announced earlier this year.
Reliance Retail Ltd, a subsidiary of RRVL, operates India's largest retail business serving close to 640 million footfalls across its about 12,000 stores nationwide.
Inclusive strategy
“I am delighted to extend our relationship with Silver Lake to our transformational efforts of building an inclusive partnership with millions of small merchants while providing value to Indian consumers across the country in the Indian retail sector. We believe technology will be key to bringing the much-needed transformation in this sector so that various constituents of the retail ecosystem can collaborate to build inclusive growth platforms. Silver Lake will be an invaluable partner in implementing our vision for Indian retail,” RIL Chairman and Managing Director Mukesh Ambani said.
Morgan Stanley acted as financial advisor to Reliance Retail and Cyril Amarchand Mangaldas and Davis Polk & Wardwell were the legal counsels. Latham & Watkins and Shardul Amarchand Mangaldas & Co acted as legal counsels for Silver Lake.
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, it said.
“We are pleased to deepen our relationship with Reliance with this investment. Mukesh Ambani and his team at Reliance have created an outstanding world leader in retail and technology through their courageous vision, commitment to societal benefits, innovation excellence and relentless execution,” Egon Durban, Co-CEO and Managing Partner of Silver Lake said.
“The success of JioMart in such a short time span, especially while India, along with the rest of the world, battles the Covid-19 pandemic, is truly unprecedented, and the most exciting growth phase has just begun. Reliance’s New Commerce strategy could become the disruptor of this decade,” Durban added.
The transaction is subject to regulatory and other customary approvals.
On August 30, Reliance Retail Ventures Ltd (RRVL), a subsidiary of RIL, had acquired Future Group’s retail and wholesale business, and logistics and warehousing business for ₹24,713 crore.