Reliance and General Atlantic signed a Deal

On September 30, 2020, Reliance Industries (RIL), one of India’s largest private enterprises received an investment of Rs. 3675 crores ($498.31 million) from global growth Investor General Atlantic Investments. The investment was for about 0.84% equity stake in Reliance Retail Ventures Ltd on a fully diluted basis. This was the second investment by General Atlantic into RIL.

GA invested Rs 6598.38 crores into Jio platforms. General Atlantic has invested in innovative and diverse businesses like Slack, Uber, Airbnb, Snapchat, Alibaba, Facebook, ByteDance, Box, and Ant Financial.

Reliance Retail Ventures Limited has been the object of interest for many international investors. It is poised to emerge as a strong retail player in the huge Indian market that is worth about $800 million. Interest in RRVK has also been evinced by Advent International, a global PE firm.

Reliance Retail is said to be in advanced talks with Mubadala Investment Co – Abu Dhabi state fund. Earlier in 2020, Silver Lake invested Rs. 7500 crores into RRVL for a 1.75% stake in it. Silver Lake had earlier invested $1.35 billion earlier in Jio Platforms. US buyout firm KKR & Co. invested Rs. 5500 crores in RRVL. It acquired a 1.28% stake in the retail enterprise of RIL.

Reliance Retail Ventures Limited is a unique business strategy that leverages a disruptive market technique. With a clear understanding of the Indian retail market, RRVL has pre-money equity of Rs. 4.285 lakh crores. The shares of RIL traded at about Rs. 2244.85 after the announcement; nearly a rise of 1%. Earlier Reliance shares were traded at Rs. 2215.75.

It is poised to use digital technology to good use by encouraging growth and inclusion in the retail and grocery markets of the country. With its new e-commerce platform Reliance Jio, Reliance Retail Ventures Limited is perhaps the country’s largest retail company with about 12000 stores and expanding e-commerce business. This move can catapult the Indian retail sector through an inclusive strategy to serve millions of customers.

This would involve empowering of MSMEs and farmers by leveraging digital technology to push growth and inclusion. RRVL will benefit from Silver Lake’s expertise and network to revolutionize the retail sector in the country. JioMart was launched earlier in the year as a platform to take on e-commerce rivals like Flipkart (Walmart-owned) and Amazon.

RRVL along with JioMart will work with domestic and international companies as preferred partners. It will be a platform for merchants to leverage technology tools and be part of a larger chain infrastructure.

With a strategic tie-up with Facebook and WhatsApp, Reliance JioMart will enlist millions of small grocery agents and Kirana stores across the country. RRVL will be buying into the Future Group-owned by Kishore Bayani for about $3.38 billion.