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KKR in Advanced Talks for $1 billion Reliance Retail Stake

After Silver Lake’s deal, another US firm KKR and Co. are in advanced talks for investing about $1 billion in the retail business of Reliance Industries. There are talks about KKR acquiring a stake in Reliance Retail Ventures Ltd. The investment by this private equity firm could go as up as $1.5 billion as well.

Sources also suggest that Reliance Retail might also soon receive investment from a consumer-focused private equity firm L Catterton worth millions of dollars. However, nothing is confirmed as of now. There are no concrete comments from the representatives of Reliance, L Catterton, and KKR.

Just a few weeks ago, Mukesh Ambani was in news for selling stakes to Facebook Inc. and Google and raising around $20 billion in the process. It seems like the retail side of the business may follow suit as well. On Wednesday, Silver Lake invested around $1 billion (Rs. 75 billion) into Reliance Retail Ventures and raised the valuation of the business to Rs. 4.2 trillion.

Earlier in 2020, Silver Lake also invested around $1.35 billion in stakes of Jio Platforms Ltd. telecommunications and digital services unit. In June, L Catterton too acquired a stake in Jio Platforms worth $252 million. KKR also invested about $1.5 billion in the company.

Reliance Retail has grown to be one of the strongest arms of Reliance Industries Ltd. They run India’s largest consumer electronics chain store, fast-fashion outlets, supermarkets, and cash and carry wholesalers. Now, they have also started JioMart, an online grocery store. This unit alone operates about 12,000 stores in 7,000 towns. The reported revenue through March this year has been around Rs. 1.63 trillion.

Just last month, Reliance Industries also announced that they will be buying assets of Future Group worth Rs. 247.1 billion. Future Group’s retail, warehousing, wholesale, and logistics will be a part of this deal.

In August, Reliance also acquired a major equity stake worth Rs. 6.2 billion in Netmeds, an online pharmacy store. There are also ongoing negotiations for acquiring stakes in companies like Zivame, an online lingerie store, and Urban Ladder, an online furniture store.

A continuous streak of attracting investors to the retail business has led to a large rise in Ambani’s wealth as well. Just this year, his net worth has increased by about $22 billion. According to the Bloomberg Billionaires Index, this has led to him taking the 7th position in the list of world’s richest people.

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