KKR To Invest Rs 2,070 Crore In Reliance Retail For An Additional 0.25% Stake

Reliance Retail Ventures Ltd. said on Monday it has raised Rs 2,069.5 crore from KKR & Co. Inc. at a valuation of $100 billion (Rs 8.36 lakh crore).

The US-based private equity firm's follow-on investment will translate into an additional equity stake of 0.25% in RRVL on a fully diluted basis, the Mukesh Ambani-led company said in a statement. The latest investment will take KKR's total equity stake in the country's largest retailer to 1.42%.

"Their [KKR's] latest investment in RRVL after their previous investment further reinforces their strong belief in RRVL’s vision and capabilities," Isha Ambani, director of Reliance Retail Ventures, was quoted as saying.

In 2019, Ambani said that the group planned to list the retail business in five years. To prepare for the initial public offering, the Sebi guidelines mandate that the public shareholding, including those held by financial investors, in a company must be at least 25%. At present, around 10% of RRVL is owned by global investors, including the fresh stake sale to KKR.

KKR's deal follows the Qatar Investment Authority's investment of Rs 8,278 crore for a 0.99% stake in Mukesh Ambani’s retail empire last month, which was also Reliance Retail's first fund-raising round after a period of three years.

The previous fund-raising round by Reliance Retail in 2020 from various global investors, for an aggregate amount of Rs 47,265 crore, was done at a pre-money equity value of Rs 4.21 lakh crore. KKR, through its Asia private equity funds, invested Rs 5,550 crore in Reliance Retail in 2020.

"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 the pandemic and other disruptions," said Joe Bae, Co-CEO of KKR, in a statement. "We look forward to continuing to work alongside the Reliance Retail team to support the company’s mission to build a more inclusive Indian retail economy."