SUMMARY
Reliance Retail was valued at a pre-money equity value of INR 4.21 Lakh Cr
KKR had invested INR 11,367 Cr in Jio Platform for 2.32% equity stake
Reliance Retail aims to tap on its digitisation ambition with a new ecommerce strategy
Reliance Industries’ retail venture Reliance Retail has raised INR 5,550 Cr from global investment firm KKR, which is also an investor in Jio Platforms, at a pre-money equity value of INR 4.21 Lakh Cr. With this, KKR gets 1.28% equity stake in Reliance Retail on a fully diluted basis.
Back in May, the global investment firm invested INR 11,367 Cr in Reliance Jio Platform in exchange for 2.32% equity stake on a fully diluted basis. The transaction had valued Jio Platforms at an equity value of INR 4.91 Lakh Cr and an enterprise value of INR 5.16 Lakh Cr.
Founded in 1976, KKR has nearly $222 Bn in assets under management as of June 30, 2020. The company has also invested approximately $5.1 Bn across more than 15 Indian companies including JB Chemicals, Max Healthcare, Eurokids International and Ramky Enviro Engineers. The company’s global portfolio includes BMC software, ByteDance, GoJek and Epic Games.
Commenting on the investment, KKR’s cofounder and co-CEO Henry Kravis, said, “Reliance Retail’s new commerce platform is filling an important need for both consumers and small businesses as more Indian consumers move to shopping online and the company offers tools for kiranas to be a critical part of the value chain. We are thrilled to support Reliance Retail in its mission to become India’s leading omnichannel retailer and ultimately to build a more inclusive Indian retail economy.”
The fundraise will help Reliance Retail tap on its digitisation ambition with a new ecommerce strategy. The Mukesh Ambani-led company has already started the transformational digitisation of small and unorganised merchants. The company says it’s committed to expanding its network to over 20 Mn such merchants. The company believes that such a step will enable merchants to use technology tools and an efficient supply chain infrastructure to deliver a superior value proposition to their own customers.
Earlier this month, Reliance Retail also raised INR 7,500 Cr from another Jio Investor Silver Lake in exchange for a 1.75% stake at a pre-money equity value of INR 4.21 lakh Cr. The company is also said to be in talks to sell a 40% stake worth $20 Bn to ecommerce giant Amazon. Moreover, media reports also suggest that Amazon’s rival Walmart may join in as an investor in Reliance Retail.
