Silver Lake to acquire 1.75% stake in Reliance Retail for Rs 7,500 crore

New Delhi, 9-Sep-2020

Billionaire Mukesh Ambani-controlled Reliance Industries (RIL) on Wednesday (September 9) sealed a deal under which US-based private equity firm Silver Lake Partners will pick up a 1.75 per cent stake in Reliance Retail Ventures Limited (RRVL), the oil-to-telecom conglomerate's retail arm, for Rs 7,500 crore. This investment values RRVL at a pre-money equity value of Rs 4.21 lakh crore. Silver Lake�s investment will translate into a 1.75% equity stake in RRVL on a fully diluted basis. This marks the second billion-dollar investment by Silver Lake in a Reliance Industries subsidiary after the $1.35 billion investment in Jio Platforms announced earlier this year. RIL shares were 1.07 per cent higher at Rs 2,129.60 after the deal announcement, while the benchmark BSE Sensex was down 0.49 per cent at 38,179. Reliance Retail operates India's largest, fastest-growing and most profitable retail business serving close to 640 million footfalls across its 12,000 stores nationwide. Reliance Retail, through its new commerce strategy, has started a transformational digitalisation of small and unorganised merchants and is committed to expanding the network to over 20 million of these merchants, helping them benefit from the use of technology tools and efficient supply chain infrastructure to deliver a superior value proposition to their own customers. Commenting on the deal with Silver Lake, Mukesh Ambani, Chairman and Managing Director, Reliance Industries, said: �I am delighted to extend our relationship with Silver Lake to our transformational efforts of building an inclusive partnership with millions of small merchants while providing value to Indian consumers across the country in the Indian retail sector."
"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," he added.
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, the American private equity firm is the global leader in large-scale technology investing. Silver Lake's other investments have included Airbnb, Alibaba, Alphabet�s Verily and Waymo units, Dell Technologies, Twitter and numerous other global technology leaders. �We are pleased to deepen our relationship with Reliance with this investment. Mukesh Ambani and his team at Reliance have created an outstanding world leader in retail and technology through their courageous vision, commitment to societal benefits, innovation excellence and relentless execution. "The success of JioMart in such a short time span, especially while India, along with the rest of the world, battles the COVID-19 pandemic, is truly unprecedented, and the most exciting growth phase has just begun. Reliance�s New Commerce strategy could become the disruptor of this decade. We are thrilled to have been invited to partner with Reliance in their mission for Indian Retail,� Egon Durban, Co-CEO and Managing Partner of Silver Lake, said. The deal is, however, subject to regulatory and other customary approvals. Morgan Stanley acted as financial advisor to Reliance Retail and Cyril Amarchand Mangaldas and Davis Polk & Wardwell acted as legal counsels. Latham & Watkins and Shardul Amarchand Mangaldas & Co acted as legal counsels for Silver Lake.