US’ Silver Lake buys 1.75 per cent stake in Reliance Retail for Rs 7,500 crore

New Delhi, September 9

US non-public fairness agency Silver Lake Partners has picked up 1.75 per cent stake within the retail arm of Reliance Industries for Rs 7,500 crore, the Indian agency mentioned in an announcement.

“Reliance Industries Limited and Reliance Retail Ventures Ltd (RRVL) announced today that Silver Lake will invest Rs 7,500 crore into RRVL, a subsidiary of Reliance Industries,” the assertion mentioned.

This funding values RRVL at a pre-money fairness worth of Rs 4.21 lakh crore. Silver Lake’s funding will translate right into a 1.75 per cent fairness stake in RRVL on a totally diluted foundation.

This marks the second billion-dollar funding by Silver Lake in a Reliance Industries subsidiary after the USD 1.35 billion funding in Jio Platforms introduced earlier this 12 months.

“Reliance Retail Limited, a subsidiary of RRVL, operates India’s largest, fastest growing and most profitable retail business serving close to 640 million footfalls across its about 12,000 stores nationwide,” the assertion mentioned.

With greater than USD 60 billion in mixed belongings below administration and dedicated capital and a concentrate on the world’s nice tech and tech-enabled alternatives, Silver Lake is the worldwide chief in large-scale expertise investing.

Its different investments have included Airbnb, Alibaba, Alphabet’s Verily and Waymo items, Dell Technologies, Twitter and quite a few different world expertise leaders.

After monetising Jio Platforms—which homes the agency’s telecom arm and digital ventures, richest Indian Mukesh Ambani is trying to rope in traders within the retail enterprise. Reliance could also be trying to promote about 10 per cent of Reliance Retail.

Late final month, Reliance acquired the retail and logistics companies of Future Group for Rs 24,713 crore to spice up its retail vertical.

Silver Lake was the primary US non-public fairness agency to put money into Jio after tech large Facebook took a 9.99 per cent stake within the firm for Rs 43,573.62 crore. Silver Lake purchased 2.08 per cent in Jio in two tranches for a complete of Rs 10,202.55 crore.

Rival non-public fairness teams KKR, Vista and General Atlantic adopted Silver Lake to take stakes in Jio. Other notable traders included Google and Abu Dhabi’s sovereign wealth fund Mubadala.

All traders in Jio Platforms together with Silver Lake have been provided an opportunity to discover investing in Reliance Retail.

Ambani had at Reliance Industries’ latest annual basic assembly acknowledged that it had been approached by strategic/monetary traders for a stake in Reliance Retail.

Commenting on the transaction with Silver Lake, Ambani, Chairman and Managing Director, Reliance Industries, mentioned, “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,” he mentioned.

Commenting on the funding, Egon Durban, Co-CEO and Managing Partner of Silver Lake, mentioned, “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.”            

“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. We are thrilled to have been invited to partner with Reliance in their mission for Indian Retail,” Durban mentioned.

The transaction is topic to regulatory and different customary approvals.

Morgan Stanley acted as monetary advisor to Reliance Retail and Cyril Amarchand Mangaldas and Davis Polk & Wardwell acted as authorized counsel. Latham & Watkins and Shardul Amarchand Mangaldas & Co acted as authorized counsel for Silver Lake. PTI

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