Saudi Arabia's Public Investment Fund invests Rs 9,555 crore in Reliance Retail Ventures
Mumbai, November 5, 2020
The Mukesh Ambani-led Reliance Industries Limited (RIL) and its subsidiary Reliance Retail Ventures Limited (RRVL) announced here today that Saudi Arabia's Public Investment Fund (PIF) would invest Rs 9,555 crore (approximately $ 1.3 billion) in RRVL for a 2.04% equity stake in the company.
The investment values RRVL at a pre-money equity value of Rs 4.587 lakh crore (approximately $ 62.4 billion), a press release from Reliance said.
"This investment will further strengthen PIF’s presence in India’s dynamic economy andpromising retail market segment. The investment in RRVL follows PIF’s earlier acquisition of a 2.32% stake in Jio Platforms, the digital services subsidiary of Reliance Industries.
"The transaction is in line with PIF’s strategy as a leading global investor with a proven track record of investing in innovative and transformative companies globally and develop strong partnerships with leading groups in their respective markets.
"India’s retail sector is one of the largest in the world and accounts for over 10% of its gross domestic product (GDP) which presents meaningful growth potential," the release said.
Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said: "We at Reliance have a long-standing relationship with the Kingdom of Saudi Arabia. PIF is at the forefront of the economic transformation of the Kingdom of Saudi Arabia. I welcome PIF as a valued partner in Reliance Retail and look forward to their sustained support and guidance as we continue our ambitious journey to transform India’s retail sector for enriching the lives of 1.3 billion Indians and millions of small merchants."
Yasir Al-Rumayyan, Governor of PIF, said: "We are pleased to be furthering our trusted partnership with Reliance Industries, the leading player in some of India’s most exciting sectors. This transaction demonstrates PIF’s commitment to investing and partnering for the long-term with innovative businesses around the world that lead and transform their sectors.”
“This investment further demonstrates PIF’s commitment to generating returns for the Saudi people and driving the economic diversification of Saudi Arabia," he added.
Reliance Retail Limited, a subsidiary of RRVL, operates India's largest, fast-growing retail business serving close to 640 million footfalls at nearly 12,000 stores across the country.
"Reliance Retail’s vision is to galvanize the Indian retail sector through its new commerce strategy, serving millions of customers by empowering millions of micro, small and medium enterprises (MSMEs)," the release added.
RIL is India’s largest private sector company, with a consolidated turnover of Rs 659,205 crore ($87.1 billion), cash profit of Rs 71,446 crore ($9.4 billion), and net profit of Rs 39,880 crore ($5.3 billion) for the year ended March 31, 2020.
RIL’s activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and digital services.
The Public Investment Fund is one of the largest and most impactful sovereign wealth funds in the world, driving the economic transformation of Saudi Arabia for the benefit of its people while helping shape the future global economy.
It acts as Saudi Arabia’s primary investment arm aiming toward generating long-term value for the kingdom in line with its Vision 2030.