PE firm General Atlantic to invest $498 million in Reliance Retail

Months after Reliance Jio, another subsidiary of Reliance Industries (RIL) is raising capital from New York based private equity firm General Atlantic. 

Mukesh Ambani led RIL on Wednesday announced that General Atlantic will invest $498 million (Rs 3,675 crore) into its retail arm, Reliance Retail Ventures (RRVL). 

Earlier this year, the PE firm had picked up 1.34% equity stake in RIL’s digital arm Jio Platforms for $871 million (Rs 6,598.38 crore). 

The current investment values Reliance Retail at a pre-money equity value of Rs 4.285 lakh crore, the company said in a statement. General Atlantic’s investment will translate into a 0.84% equity stake in RRVL on a fully diluted basis.

Reliance Retail has collectively raised $1.8 billion (Rs 13,050 crore) in the past few weeks from private equity firms Silver Lake Partners  and KKR for 1.75% and 1.28% stake, respectively.

“I am pleased to extend our relationship with General Atlantic as we work towards empowering both merchants and consumers alike,” Mukesh Ambani, chairman and managing director of Reliance Industries said.

Following Jio’s suite, RRVL has been pooling in large cheques as it looks to expand its business with the recent acquisition of Kishore Biyani-led Future Group for $3.38 billion. 

Reliance Retail, which claims to be serving close to 640 million footfalls across its 12,000 stores nationwide, runs grocery brands Reliance Fresh, value supermarket chain Reliance Smart, online grocery business arm Jio Mart, physical retail businesses of Reliance Digital, Reliance Jewels, Reliance Trends, Reliance Footwear, Jio Stores, Project Eve and fashion ecommerce platform AJIO.

The deal, which is subject to regulatory and other customary approvals, had Morgan Stanley acting as financial advisor to Reliance Retail and Cyril Amarchand Mangaldas and Davis Polk & Wardwell acted as legal counsels. Shardul Amarchand Mangaldas & Co and Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal counsel to General Atlantic.