Abu Dhabi's sovereign investor Mubadala Investment Company will invest Rs 6,247.5 crore in Reliance Retail Ventures Limited, the retail arm of Reliance Industries. This marks the second significant investment by the sovereign investment company in a Reliance Industries subsidiary after $1.2 billion investment in Jio Platforms earlier this year. This investment will translate into 1.40 per cent equity stake in the Mukesh Ambani-led retail major on a fully diluted basis. The investment values Reliance Retail at a pre-mpney value of Rs 4.28 lakh crore, Reliance Industries said in a statement on Thursday.
Mubadala's investment will boost Reliance Retail's digitisation plans and onboarding small merchants and farmers in the process. This development comes a day after California-based Silver Lake committed an additional investment of Rs 1,875 crore in Reliance Retail Ventures Limited (RRVL), taking its total investment in the company to Rs 9,375 crore, equivalent to 2.13 per cent stake in the company. Reliance Retail has also signed a deal with General Atlantic for an investment of Rs 3,675 crore for 0.84 per cent stake. Private equity firm KKR has also said that it would invest Rs 5,550 crore in RRVL for 1.28 per cent stake.
"I am happy to welcome Mubadala as a valued investor in Reliance Retail Ventures. We value the partnership with a knowledge-rich organization like Mubadala and acknowledge their confidence in our mission to strengthen the core of India's retail sector - the millions of small retailers, merchants and shopkeepers - through the power of technology. Mubadala's investment and guidance will be an invaluable support in this journey," said Reliance Industries Chairman Mukesh Ambani after the announcement.
"We are pleased to deepen our relationship with Reliance Industries through this investment in Reliance Retail Ventures. Their vision is the inclusive transformation of India's consumer economy through the power of digitization, creating opportunities and market access for millions of small businesses across the country, and we are committed to supporting the company's continuing development," said Khaldoon Al Mubarak, Managing Director and Group CEO, Mubadala Investment Company.
Morgan Stanley acted as financial advisor to Reliance Retail and Cyril Amarchand Mangaldas and Davis Polk & Wardwell acted as legal counsels. The deal is subject to regulatory and other customary approvals.