General Atlantic to invest Rs 3,675 cr in Reliance Retail for 0.84% stake

This is the second such investment by General Atlantic in a Reliance venture following a Rs 6,598.38 crore investment in Jio Platforms announced earlier this year

General Atlantic, a leading global growth equity firm will invest Rs 3,675 cr in Reliance Retail Ventures Limited, RIL said in a BSE filing on Wednesday. 

General Atlantic's investment will translate into a 0.84% equity stake in RRVL. The deal values Reliance Retail at a pre-money equity value of Rs 4.285 trillion, said RIL in a media release.

Reliance Retail Ventures Limited is a subsidiary of Reliance Industries Limited, and holding company of all the retail companies under the RIL Group. It 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.

General Atlantic had also invested Rs 6,598.38 crore in another RIL subsidiary, Jio Platforms earlier this year.

“I am pleased to extend our relationship with General Atlantic as we work towards empowering both merchants and consumers alike, and ultimately transforming Indian Retail. Like Reliance Retail, General Atlantic believes in the fundamental ability of digital enablement to drive progress, growth, and inclusion across India and the world. We look forward to leveraging General Atlantic’s extensive expertise at the intersection of technology and consumer businesses, and two decades of experience investing in India, as we create a disruptive New Commerce platform to redefine retail in the country,” said RIL Chairman and MD, Mukesh Ambani in a statement.

The investment will add fire to Ambani's battle for dominance in the retail market that is also being eyed by Jeff Bezos' Amazon.com and Walmart Inc's Flipkart.

General Atlantic has a longstanding tradition of backing disruptive entrepreneurs and companies around the world, including Airbnb, Alibaba, Ant Financial, Box, ByteDance, Facebook, Slack, Snapchat, Uber and other global technology leaders. All the 13 investors, who had poured in a combined Rs 1.52 trillion in Jio Platforms, have been offered a chance to explore investing in the retail unit.

Besides Silver Lake, KKR and General Atlantic, the other investors in Jio Platforms - which houses India's youngest but largest telecom operator Jio - include Facebook, Google and Abu Dhabi's sovereign wealth fund Mubadala.

“General Atlantic is thrilled to be backing Mukesh’s New Commerce mission to drive substantial positive change in the country’s retail sector, which goes hand-in-hand with his vision to enable a Digital India through the work of Jio Platforms," Bill Ford, Chief Executive Officer of General Atlantic said in the statement. 

The transaction is subject to regulatory and other customary approvals.

Earlier this month, RIL had informed BSE that global investment firm KKR will invest Rs 5,500 crore in Reliance Retail for 1.28 per cent equity share.

On Saturday, September 26, RIL also announced that it has received Rs 7,500 crore from US private equity firm Silver Lake Partners, which has picked up 1.75 per cent stake in its retail arm. 

Abu Dhabi state fund Mubadala Investment Co is also said to be in advanced talks to invest up to $1 billion in RRVL.