ADIA backs Reliance Retail’s new funding

Reliance Retail Ventures Limited has announced a significant infusion of funds with a subsidiary of the Abu Dhabi Investment Authority (ADIA) investing $597 million (Rs. 4,967) crore into the retail arm of Reliance Industries Ltd, led by Mukesh Ambani.

This substantial investment has raised RRVL’s pre-money equity value, positioning it as one of the top four companies in India in terms of equity value.

ADIA’s investment secures them a 0.59% equity stake in RRVL on a fully-diluted basis, further strengthening the strategic partnership between the two entities.

Isha Mukesh Ambani, Executive Director of Reliance Retail Ventures Limited, expressed satisfaction with the deepening of their relationship with ADIA and the continued support of ADIA as an investor. She highlighted ADIA’s extensive experience in creating value globally, which will be beneficial in realising their vision and transforming the Indian retail sector. The investment reflects ADIA’s belief in the Indian economy and Reliance Retail’s business fundamentals, strategy, and execution capabilities.

Hamad Shahwan Aldhaheri, Executive Director of the Private Equities Department at ADIA, praised Reliance Retail’s adaptability and growth in the rapidly evolving market. He emphasised that this investment aligns with ADIA’s strategy to support transformative businesses.

This development comes in the wake of reports suggesting that Reliance is in advanced discussions with global investors to raise approximately US $2.5 billion in preparation for a potential stock market listing.

RRVL, which operates India’s largest retail network, serves 267 million loyalty customers through an integrated omnichannel platform. It encompasses 18,500 stores and digital commerce outlets offering a wide range of products, including groceries, consumer electronics, fashion, lifestyle, and pharmaceuticals.

Morgan Stanley provided financial advisement for this investment, while legal counsels Cyril Amarchand Mangaldas and Davis Polk & Wardwell oversaw the legal aspects.

This investment follows a recent capital injection from global investment firm KKR, which increased its stake in RRVL from 1.17% to 1.42%, and a significant $1 billion investment from the Qatar Investment Authority (QIA) for a 1% stake in RIL’s retail business.