Reliance Retail ropes in Abu Dhabi-based Mubadala for ₹6,248 crore stake

Abu Dhabi-based Mubadala Investment Company is set to invest ₹6,247.5 crores in Mukesh Ambani-led Reliance Industries' retail arm, Reliance Retail Ventures, the company announced on Thursday.

Mubadala will acquire 1.40% stake in Reliance Retail Ventures Limited (RRVL) by giving the Reliance group company a pre-money equity value of ₹4.285 lakh crore. The Mubadala deal comes after a series of investments in Reliance Industries group companies and is likely to boost the conglomerate’s retail presence in the domestic market. This is the second significant investment by Mubadala in a Reliance Industries subsidiary after it purchased a $1.2-billion stake in Jio Platforms earlier this year.

Reliance Retail runs India's fastest-growing and most profitable retail business serving nearly 640 million customers across its 12,000 stores nationwide. Reliance Industries shares ended 0.39% lower at ₹2,225, before the announcement of the Mubadala deal.

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READ | Mukesh Ambani's Wealth Shoots Up 73% To Rs 6.58 Lakh Crore; Adani Moves Up In Rankings

General Atlantic invests Rs 3,675 crores

Last week, Reliance Retail announced that American growth equity firm General Atlantic will invest Rs 3,675 crore for a 0.84% stake in the company. This is the second also the investment by General Atlantic in a subsidiary of Reliance Industries, following a Rs 6,598.38 crore investment in Jio Platforms announced earlier this year.

"This investment values Reliance Retail at a pre-money equity value of Rs 4.285 lakh crore. General Atlantic's investment will translate into a 0.84% equity stake in Retail Retail Ventures Ltd (RRVL) on a fully diluted basis," the company said in a statement. 

READ | Mukesh Ambani's Reliance Retail Ventures Gets Rs 5,550 Cr KKR Influx At Massive Valuation

Earlier this month, Silver Lake and KKR & Co. had agreed to invest Rs 7,500 crore and Rs 5,550 crore, respectively, for a 1.75% and 1.28% stake in the retail holding arm.

According to an official statement, KKR has USD 222 billion in assets under management as of June 30, 2020. Silver Lake, a California-based company has more than $60 billion in combined assets under management and committed capital. The US company's other investments include Airbnb, Alibaba, Alphabet’s Verily and Waymo units, Dell Technologies, Twitter, etc. 

Meanwhile, the personal net worth of Reliance Industries chairman Mukesh Ambani rose by 73% to Rs 6.58 lakh crore, helping him retain the title of being the richest Indian for the ninth consecutive year with a wider margin, according to a report released on Tuesday.

READ | Reliance Retail Announces Rs 7,500 Crore Investment From US-based Firm Silver Lake

(Image credits: PTI)