Reliance Retail Ventures Limited and Reliance Industries Limited have recently unveiled plans to sell a substantial equity stake to global investment firm KKR. The deal, which involves an investment of nearly Rs.5,550 crore, will bring the pre-money equity value of Reliance Retail to almost Rs.4.21 lakh crore. Furthermore, KKR will achieve a 1.28% RRVL equity stake on a fully diluted basis.
This deal is the second such initiative taken by Reliance Retail over the past two weeks. It comes along the heels of a recently inked deal with private equity firm Silver Lake Partners, which was aiming for a 1.75% stake in Reliance Retail for an investment sum of Rs.7,500 crore.
This deal is also the second investment made by KKR in a Reliance Industries subsidiary, the first being an investment of Rs. 11,367 crore in Jio Platforms, announced earlier in 2020.
For the record, KKR, which was founded in 1976, has assets worth more than $222 billion under management, as on 30th June 2020.
According to Reliance Retail, the firm witnesses footfalls over nearly $640 million, in over 12,000 stores across the country.
Reliance Industries Chairman & Managing Director, Mukesh Ambani has reportedly expressed his pleasure at welcoming KKR to RRVL in the capacity of investor, becoming a part of the company’s consistent efforts towards revolutionizing the retail ecosystem in India. According to Mr. Ambani, KKR has made its mark as a valued collaborator to many industry-leading franchises and has shown great dedication towards the Indian market over the years. He further went on to express his anticipation towards integrating the global platform and industrial & operational expertise of KKR into RRVL’s retail business and digital services.
The deal also involved the role of Morgan Stanley and Deloitte Touche Tohmatsu India LLP as financial advisors to Reliance Retail and KKR, respectively.