People familiar with the matter said that investor demand for Reliance’s retail business was so strong that Carlyle and SoftBank were both on the waiting list.
People familiar with the matter said that Carlyle and SoftBank have recently expressed interest in investing in Mukesh Ambani’s Reliance Retail Company. Since the information is not public, they declined to be named. People familiar with the matter said that because Indian conglomerates are already in advanced negotiations with other financial investors, Reliance asked the two companies to wait and see.

Ambani is using supporters of his digital services business, and the company has secured US$20 billion (approximately Rs 1,473.84 billion) in guarantees in recent months when seeking funding for Reliance Retail. Silver Lake is an investor in Jio and last week agreed to raise US$1 billion (approximately Rs 74.89 billion). According to Bloomberg News, other Jio investors, including private equity funds KKR and L Catterton, are also considering investing.

People familiar with the matter said that Mubadala of Abu Dhabi is also an investor in Jio and is considering an investment of approximately US$750 million (approximately Rs 5,507 crore) in Reliance Retail. A person familiar with the matter said that the Abu Dhabi Investment Authority and Saudi Arabia’s public investment funds are also considering investments.

The strong reaction from Jio’s financial investors means that it is not enough for others. People familiar with the matter said that Reliance plans to sell about 10% of Reliance Retail’s shares to financial investors, and almost all shares worth US$5.7 billion (approximately Rs 41,985 crore) have been absorbed.

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Bloomberg News reported last week that the largest allocation was to Amazon. Ambani offered to sell approximately US$20 billion (approximately Rs 1,473,384 crore) of shares in the retail business to US technology giants, equivalent to up to 40% of the shares. According to data compiled by Bloomberg, if successful, this transaction will be the largest ever transaction between India and Amazon.

People familiar with the matter said that if others reduce their commitments, potential investors including Carlyle and SoftBank can still get Reliance Retail shares. People familiar with the matter said that negotiations are ongoing and may still be delayed or fall apart.

Representatives of Reliance, Carlyle, SoftBank, ADIA and Mubadala declined to comment, while representatives of PIF did not immediately respond to requests for comment.

Ambani has identified technology and retail as areas of future growth, and got rid of the focus of the energy business he inherited from his father, who died in 2002. The retail industry is the next frontier for the 63-year-old Indian tycoon, whose ambitions include building houses. E-commerce giants, such as China’s Alibaba.

-With the assistance of Matthew Martin and Pavel Alpeyev.

©2020 Bloomberg (Bloomberg LP)

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