RIL gains 1% as Silver Lake to invest Rs 7,500 crore in Reliance Retail

Shares of Reliance Industries (RIL) were up 1.5 per cent to Rs 2,139 on the BSE on Wednesday after the company announced that Silver Lake will invest Rs 7,500 crore into Reliance Retail Ventures Limited (RRVL), a subsidiary of RIL. The stock was trading higher for the third straight day in an otherwise subdued market.

“This investment values RRVL at a pre-money equity value of Rs 4.21 trillion. Silver Lake’s investment will translate into a 1.75 per cent equity stake in RRVL on a fully diluted basis,” RIL said in a press release.

This marks the second billion dollar investment by Silver Lake in a RIL subsidiary after the $1.35 billion investment in Jio Platforms announced earlier this year, it said.

Reliance Retail, a subsidiary of RRVL, operates India's largest, fastest growing and most profitable retail business serving close to 640 million footfalls across its around 12,000 stores nationwide. RRVL reported a consolidated turnover of Rs 162,936 crore ($ 21.7 billion) and net profit of Rs 5,448 crore ($ 726.4 million) for the year ended March 31, 2020.

With more than $60 billion in combined assets under management and committed capital and a focus on the world’s great tech and tech-enabled opportunities, Silver Lake is the global leader in large-scale technology investing.

Commenting on the transaction with Silver Lake, Mukesh Ambani, Chairman and Managing Director, Reliance Industries, said, “We believe technology will be key to bringing the much-needed transformation in this sector so that various constituents of the retail ecosystem can collaborate to build inclusive growth platforms. Silver Lake will be an invaluable partner in implementing our vision for Indian Retail.”

At 09:51 am, RIL was trading 0.54 per cent higher at Rs 2,118 on the BSE, as compared to 0.64 per cent rise in the S&P BSE Sensex. A combined 6.5 million equity shares have already changed hands on the counter on the NSE and BSE, so far.