Investments continue to pour in for Reliance Retail. Two more investors have put money in Reliance Retail Ventures. GIC, the sovereign wealth fund of Singapore and TPG, the US-based global investment firm are the latest ones.
GIC will invest Rs 5512.5 crore ($752 million) into Reliance Retail. GIC’s investment will translate into a 1.22% equity stake in Reliance Retail on a fully diluted basis.
TPG will invest Rs 1837.5 crore (250 million) into Reliance Retail TPG’s investment will translate into a 0.41% equity stake in RRVL on a fully diluted basis.
This marks the second investment by TPG in a subsidiary of Reliance Industries, following a Rs 4546.8 crore investment in Jio Platforms announced earlier this year.
Reliance Retail operates India’s largest and fastest growing retail business serving close to 640 million footfalls across its 12,000 stores nationwide.
Reliance Retail, through its New Commerce strategy, has started the digitalization of small and unorganised merchants and is committed to expanding the network to over 20 million of these merchants. This will enable the merchants to use technology tools and an efficient supply chain infrastructure to deliver a superior value proposition to their customers.
$4.4 billion in less than a month for Reliance Retail
The two announcements come on the back of a busy week for Reliance Retail, which in the last three days has announced investments from Mubadala, Silver Lake (second investment with its co-investors) and General Atlantic. Earlier in September, Silver Lake and KKR had also chipped in with their funds.
With these, Reliance has sold 7.28% stake in the retail unit since September 9 for a total of Rs 32,297.50 crore ($4.4 billion).
Investors gung-ho on Reliance Retail
Mukesh Ambani, Chairman and Managing Director of Reliance Industries, in a statement said, “TPG has a proven track record of being a valuable partner to global technology businesses and industry leaders and we look forward to their guidance and support in our journey.”
Jim Coulter, Co-CEO, TPG, said, “Reliance Industries has utilized technology and scale to position Reliance Retail as an incredibly strong, well-organized, and innovative leader. We are excited to join with them as they seek to create a more inclusive retail industry that allows Kiranas and Indian consumers to benefit from the connectivity, efficiency, and accessibility of the Reliance Retail omnichannel platform.”
Isha Ambani, Director of Reliance Retail, said, “TPG’s rich experience will be invaluable to the Reliance Retail mission.”
Puneet Bhatia, Co-Managing Partner and Country Head, India of TPG Capital Asia, said, “Reliance Retail continues to lead the industry by creating a retail platform that meets the demands of a new generation of Indian consumers. We are excited to work with Reliance Industries as they reimagine the retail experience across the value chain.”
TPG is making the investment from its TPG Capital Asia fund.
On GIC Mukesh Ambani said “GIC’s global network and track record of long-term partnerships will be invaluable to the transformation story of Indian Retail. This investment is a strong endorsement of our strategy and India’s potential.”
Lim Chow Kiat, Chief Executive Officer, GIC, said: “We believe Reliance Retail will continue to use its extensive supply chain and store networks, as well as strong logistics and data infrastructure, to add value to its customers and shareholders.”
It may be recalled that addressing shareholders at Reliance Industries 43rd annual general meeting recently, Mukesh Ambani had said “Reliance Retail has received strong interest from strategic and financial investors.”
Ambani explained his plans to add newer categories like electronics, fashion, pharmaceutical and healthcare into its omni-channel venture, JioMart.
Jio Mart is positioned to take on Walmart-backed Flipkart and the other behemoth in the business Amazon.