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Public Investment Fund to buy 2.04% stake in Reliance Retail for Rs 9,555 crore

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Saudi Arabia's PIF invests Rs 9,555 croreSaudi Arabia’s Public Investment Fund(PIF) will buy 2.04% equity stake in Reliance Retail Ventures Limited (RRVL), a subsidiary of Reliance Industries Limited(RIL) for Rs 9,555 crore(about USD1.3 billion). This is the largest investment made by any fund so far in RRVL. This marks the 9th investment by global investors in RRVL, since September 9, 2020.

  • Including PIF’s investment RRVL has raised Rs 47,265 crore. The global investors with this investment hold 12.27% combinedly.
  • This investment values RRVL at a pre-money equity value of Rs 4.587 lakh crore (approximately $62.4 billion).
  • Earlier PIF has acquired 2.32% stake in Jio Platforms, subsidiary of RIL for Rs 11,367 Crores.

About the Investment

i.This investment will further strengthen the existence of PIF in the Indian economy and the developing retail market segment.

ii.The transaction is in accordance with the strategy of PIF as a leading global investor with a proven track record of investing in companies that are innovative and transformative globally and developing strong partnerships with leading groups in their respective markets.

Key Info

  • The retail sector of India is one of the largest in the world.
  • It accounts more than 10% of its Gross Domestic Product (GDP).

Previous Investment in RRVL

S.No          Investor in RRVL Date of Investment (2020)           Investment Amount (Rs in Crores)         % Stake
1  Silver Lake September 9  7,500  1.75%
2 KKR September 23 5,550 1.28%
3 Co-investors of Silver Lake- Additional Investment  September 30  1,875 2.13%
4  General Atlantic  September 30 3,675 0.84%
5 Mubadala Investment Company October 1  6,247.5 1.40%
6 GIC October 2 5,512.5 1.22%
7 TPG  October 3 1,837.5  0.41%
8  Abu

Dhabi Investment Authority

 October 6 5,512.50  1.20%

Note– RRVL received the subscription amount of Rs 5,550 crore from Alyssum Asia Holdings II Pte. Ltd. (a unit of KKR) and allotted 81,348,479 equity shares to KKR.

Additional Info

i.RRVL, operates India’s largest, fast-growing retail business that serves around 640 million people at its approximately 12,000 stores nationwide.

ii.PIF is one of the World’s largest and most impactful sovereign wealth funds.

iii.It acts as  primary investment arm of the  Kingdom of Saudi Arabia

Recent Related News:

On 30th August 2020, The Reliance Retail Ventures Limited(RRVL), subsidiary of the Reliance Industries Limited(RIL) acquired the retail and wholesale, logistics and warehousing business of the Future Group Business as going concerns on a slump sale basis for lump sum aggregate consideration of Rs 24,713 crore.

About Reliance Industries Limited (RIL):
Chairman & Managing Director(CMD) –  Mukesh Ambani
Headquarters – Mumbai, Maharashtra

About Public Investment Fund(PIF):
Headquarters– Riyadh, Saudi Arabia
Chairman– His Royal Highness Mohammed bin Salman bin Abdulaziz Al Saud (Crown Prince of Saudi Arabia)