Global investment firm KKR is set to raise its stake in Reliance Retail Ventures Ltd (RRVL) from 1.17% to 1.42% by infusing ₹2,069 crore through an affiliate. In 2020, KKR had invested ₹5,550 crore for the first time in the retail business, spanning grocery, consumer electronics, apparel, footwear, online commerce, and jewellery.
For this transaction, RRVL had a pre-money equity value of ₹8.361 trillion, which makes it among the top four companies by equity value in India, said Reliance Industries Ltd (RIL) in a filing to exchanges on Monday. “KKR’s follow-on investment will translate into an additional equity stake of 0.25% in RRVL on a fully-diluted basis. Combined with its stake from an investment of ₹5,550 crore in RRVL in 2020, it will take its total equity stake in RRVL to 1.42% on a fully-diluted basis,” it added.
In addition to its investment in RRVL, KKR is also an investor in Jio Platforms Ltd, a digital services platform and a subsidiary of RIL. In 2020, KKR invested ₹11,367 crore in Jio.
KKR’s investment in RRVL comes primarily from its Asian Fund IV. “Throughout our investment period in Reliance Retail we have been impressed by the company’s vision and extensive work to empower retailers across India through digitalization, as well as by its resilience and performance in spite of covid and other disruptions. We look forward to continuing to work alongside the Reliance Retail team to support its mission to build a more inclusive Indian retail economy,” Joe Bae, co-CEO, KKR, said in a statement.
KKR’s follow-on investment comes after Qatar Investment Authority announced investment of ₹8,278 crore in RRVL for a 0.99% equity stake last month. The investment, done through its wholly owned subsidiary, had put RRVL at a pre-money equity value of ₹8.278 trillion or $100 billion.
RRVL, through its subsidiaries and associates, operates the largest retail business serving 267 million Indian loyalty customers with an integrated omnichannel network of over 18,500 stores and digital commerce platforms.
“We highly value our deepening partnership with KKR, and their latest investment in RRVL after their previous investment further reinforces their strong belief in RRVL’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,” Isha Mukesh Ambani, director, RRVL, said. Large global investors have backed RRVL that has grown to dominate India’s organized retail market.
