US fund Silver Lake in talks to buy $1bn stake in Reliance Retail
04 September 2020
US private equity firm Silver Lake is in talks to invest about $1 billion in Mukesh Ambani’s Reliance Retail at a valuation of roughly $57 billion as the Silicon Valley group seeks to deepen its exposure to India’s growing market for retail technology.
Silver Lake’s interest comes after the Mukesh Ambani-controlled Reliance Industries, the holding company of Reliance Retail, is aiming to raise $5.7 billion by selling about 10 per cent in new shares, said the people briefed about the matter.
Silver Lake was the first US private equity firm to invest in Jio after tech giant Facebook bought a $5.7 billion stake in the company. Other notable investors include Google.
Foreign investors, including private equity groups KKR, Vista and General Atlantic, and Abu Dhabi’s sovereign wealth fund Mubadala have also took stakes in Mukesh Ambani group’s Jio Platform earlier this year as he raised $20 billion of investment for his booming digital business.
Foreign investors now see Ambani-led companies as a gateway into India’s fast-growing digital and consumer market. Jio has accommodated most of these investors by giving a chance to back Reliance Retail or Jio Platform.
Reliance last week agreed to buy the retail and logistics assets of Future Group, India’s second-largest retailer, for $3.4bn. The deal will give Reliance control of about one-third of the bricks-and-mortar stores of India’s otherwise fragmented retail sector.
Reliance is now lining up to take on global ecommerce giants such as Amazon and Walmart, which owns local group Flipkart, in a drive to tap the fast-growing market for online shopping.