KKR’s follow-on investment will translate into an additional equity stake of 0.25% in RRVL, according to a press release issued on Monday, which added that this takes the private equity giant’s holding to 1.42%.
This round of fundraising has increased RRVL’s valuation to around ₹8.36 lakh crore, from ₹8.28 lakh crore, when Qatar Investment Authority invested ₹8,278 crore less than three weeks ago.
RIL said this puts Reliance Retail Ventures on the list of the country’s top four companies by equity value.
ET on August 25 reported that Reliance Industries is likely to sell a fresh round of 8-10% in RRVL to fund expansion, retire debt and prepare for the unit’s initial public offering, which would take total stake sold to 19-21%.
Global interest
The stake sale is crucial because at the current valuation, RRVL’s IPO size will be too large for the current liquidity to absorb.At a recent annual general meeting, Reliance Industries chairman and managing director Mukesh Ambani said several global investors had shown keen interest in the conglomerate’s retail business.
The latest investment by KKR comes primarily from its Asian Fund IV. In 2020, KKR invested Rs 5,550 crore in Reliance Retail Ventures. At that time, RRVL raised Rs 47,265 crore from various global investors at a valuation of Rs 4.21 lakh crore.
At present, around 11% in RRVL is owned by global investors, over 88% by Reliance Industries and the rest by small investors.
RRVL director Isha Mukesh Ambani said the company values the deepening partnership with KKR, and that the latest investment reinforces its strong belief in the company’s vision and capabilities. “We look forward to continued engagement with KKR and to benefit from their global platform, industry knowledge and operational expertise, in our journey towards driving transformation of the Indian retail sector,” she said.
Reliance Retail Ventures, through its subsidiaries and associates, operates India’s largest, fastest-growing and most profitable retail business, serving 267 million customers with an integrated omni-channel network of over 18,500 stores and ecommerce platforms across grocery, consumer electronics, fashion and lifestyle, and medicines.