Reliance Retail Ventures Limited (RRVL), a subsidiary of oil-to-telecom conglomerate Reliance Industries, announced on September 11 that global investment firm KKR, through an affiliate, will invest Rs 2,069.50 crore in the company.
This investment values RRVL at a pre-money equity value of Rs 8.361 lakh crore, which makes it among the top four companies by equity value in the country now.
As per the statement, KKR’s follow-on investment will translate into an additional equity stake of 0.25% in RRVL on a fully-diluted basis. This, combined with its stake from its investment of Rs 5,550 crore in RRVL in 2020, will take its total equity stake in RRVL to 1.42 percent on a fully-diluted basis. The previous fund-raise round by RRVL in 2020 from various global investors of an aggregate amount of Rs 47,265 crore was done at a pre-money equity value of Rs 4.21 lakh crore.
KKR’s investment comes primarily from its Asian Fund IV. The transaction is subject to regulatory and other customary approvals, Reliance Retail noted.
Reliance Industries retail arm RRVL, through its subsidiaries and associates, operates India's largest and most profitable retail business serving 26.7 crore customers over 18,500 stores and digital commerce platforms across grocery, consumer electronics, fashion & lifestyle, and pharma consumption baskets.
Commenting on the investment, Isha Mukesh Ambani, Director, Reliance Retail Ventures Limited, said, “We look forward to continued engagement with KKR and to benefit from their global platform, industry knowledge and operational expertise, in our journey towards driving transformation of the Indian retail sector.”
Joe Bae, Co-CEO, KKR, added, “Throughout our investment period in Reliance Retail, we have been impressed by the company’s vision and extensive work to empower retailers across India through digitalization, as well as by its resilience and performance in spite of the pandemic and other disruptions. We look forward to continuing to work alongside the Reliance Retail team to support the company’s mission to build a more inclusive Indian retail economy.”
Gaurav Trehan, Head of Asia Pacific Private Equity and Head of India, KKR, also said, “Reliance Retail is a true corporate leader and innovator in India, and its differentiated model has the potential to digitalize and transform the country’s retail industry.”
Morgan Stanley acted as financial advisor to Reliance Retail Ventures Limited and Cyril Amarchand Mangaldas and Davis Polk & Wardwell acted as legal counsels.
Founded in 1976, KKR has approximately $519 billion in assets under management as of June 30, 2023. Reliance noted, "KKR’s follow-on investment in RRVL furthers its relationship with Reliance Industries Limited."
In addition to its investment in RRVL, KKR is also an investor in Jio Platforms Limited, the telecom platform of RIL.
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