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Abu Dhabi bet on Reliance Retail shopping spree

ADIA’s investment will translate into a 1.20 per cent equity stake in RRVL on a fully diluted basis
Like the previous deals, this investment values RRVL at a pre-money equity value of Rs 4.285 lakh crore.

Our Special Correspondent   |   Mumbai   |   Published 07.10.20, 01:23 AM

Reliance Industries on Tuesday announced another investment from a global investor in its retail arm. Abu Dhabi Investment Authority’s (ADIA) wholly owned subsidiary will invest Rs 5,512.50 crore into Reliance Retail Ventures Ltd (RRVL).

Like the previous deals, this investment values RRVL at a pre-money equity value of Rs 4.285 lakh crore.

ADIA’s investment will translate into a 1.20 per cent equity stake in RRVL on a fully diluted basis.

With this investment, RRVL has raised Rs 37,710 crore from global investors, covering  Silver Lake, KKR, General Atlantic, Mubadala, GIC, TPG and ADIA in less than four weeks. These investors have picked up close to 8.50 per cent in RRVL.

In June, ADIA had invested Rs 5,683.50 crore in Jio Platforms, the digital services subsidiary of RIL.

While the announcement came after market hours, the RIL stock on Tuesday ended at Rs 2,210.15, showing a marginal fall over its previous close.

Reliance Retail, a subsidiary of RRVL, has around 12,000 stores in the country. Reliance Retail has now embarked on digitalisation of small and unorganised merchants and is looking to expand this network to over 20 million of these merchants.

“We are delighted with ADIA’s current investment and continued support and hope to benefit from its strong track record of over four decades of value creation globally,’’ Mukesh Ambani, chairman and managing director of Reliance Industries, said.

“On the very low base of the first quarter, we expect the retail business to recover broadly on the back of lockdown easing, a note from BofA Securities said.

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