Reliance Retail sells 1.75% stake for $1.02 billion to Silver Lake
Category: #retail  By Saipriya Iyer  Date: 2020-09-10
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Reliance Retail sells 1.75% stake for $1.02 billion to Silver Lake

Reliance Industries Ltd., an Indian conglomerate, has reportedly raised Rs.7,500 crore (Dollar 1.02 billion) by selling a stake in its retail unit to Silver Lake Partners, a private equity firm.

As per an exchange filing, Silver Lake will acquire a 1.75Percent stake in Reliance Retail Ventures on a fully diluted basis. The investment helps in securing the companys equity value at Rs.4.21 lakh (Dollar5700). Additionally, the pre-investment equity was valued at Dollar58.55 billion.

The recent deal will mark the 3rd investment of Silver Lake in this oil-to-telecom company, following its previous investment of Rs.10,213 crore (Dollar1.3 billion) to acquire a 2.08Percent stake in Jio Platforms. This is a part of Mukesh Ambani-led companys fundraising spree that has attracted other companies such as Google LLP and Facebook.

Reliance Retail has previously revealed its plan to acquire the retail and logistics business of Future Group for Rs.27,513 crore (Dollar3.7 billion). Reliances retail unit is expected to further increase its dominance after the completion of acquiring this retail unit of Future Group. In the financial year that ended in March 2020, Reliance Retail registered a revenue worth Rs.92,778 crore (Dollar12.6 billion) from the fashion & lifestyle, consumer electronics, and groceries segments. Moreover, it also reported a Rs.1,62,936 crore (Dollar21.7 billion) consolidated turnover as well as Rs.5,448 crore (Dollar726.4 million) net profit during this period.

CLSA has reportedly stated that the latest deal between Reliance Retail and Silver Lake is not as profound as that of Jio Platforms, due to the non-involvement of new strategic players and low concerns about its debts.

Upon the closing of the acquisition deal, Reliance Retail will take control over 1,736 Big Bazaar & other stores of Future Group, which cover an area of over 28.3 million sq. ft. of retail space across a wide range of grocery and fashion segments. Reliance Retail has been operating 11,784 stores in total across various segments such as grocery, consumer electronics, and fashion & lifestyle.

Source credit:

https://www.bloombergquint.com/business/reliance-retail-raises-rs-7500-crore-by-selling-175-stake-to-silver-lake



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Saipriya Iyer

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Saipriya Iyer

Saipriya Iyer develops content for Market Size Forecasters, Algosonline, and myriad other platforms. A computer engineer by profession, she ventured into the field of writing for the love of playing with words. Having had a previous experience of 3 years under her bel...

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