Reliance Retail Eyes $1.5B Investment From Gulf And Singapore Funds

Reliance Retail, the largest retail chain in India, is said to be in talks with a group of existing investors, including sovereign wealth funds from Singapore, Abu Dhabi, and Saudi Arabia, over a new set of investments totalling around $1.5 billion, as per a Reuters report on Monday.

What Happened: These negotiations are part of Reliance Retail’s internal strategy to raise $3.5 billion by the end of September. QIA recently announced a $1 billion investment, and KKR & Co. declared a $250 million investment just this week.

Entities such as Singapore’s GIC, the Abu Dhabi Investment Authority (ADIA), and Saudi Arabia’s Public Investment Fund (PIF) are considering investing at least $500 million each in Reliance Retail at a $100 billion valuation. However, these figures are subject to change.

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Reliance Industries, the parent company of the retail unit, also plans to participate in the ongoing fundraising round of $3.5 billion. Last year, Reliance sold a 10.09% stake in its retail division, valuing it at 4.68 trillion rupees ($56.4 billion).

Why It Matters: This move comes amidst a flurry of investment activity in Reliance Retail. As previously reported, KKR invested nearly ₹2,069.50 crore at a valuation of ₹8.361 lakh crore in the retail arm of Reliance, with the investment mainly coming from its Asian Fund IV.

Earlier this month, it was reported that Reliance Retail was in advanced discussions with global investors to raise around $2.5 billion by the end of the month. In August, the company raised funds from the Qatar Investment Authority (QIA), leading to a gain in Reliance’s share price for two consecutive days.

The QIA, through a wholly owned subsidiary, invested ₹8,278 crore in Reliance Retail Ventures at a valuation of ₹8.278 lakh crore, translating to the QIA owning a 1% stake in the company. The fundraising efforts of Reliance Retail appear to be a part of a larger strategy to bolster its financial standing and possibly prepare for a listing.

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