InvestorQ : Why have TPG and GIC of Singapore invested in Reliance Retail?
Khushi Patel made post

Why have TPG and GIC of Singapore invested in Reliance Retail?

Anjana Aiyar answered.
3 years ago

After aggressively monetizing Jio Platforms, now Reliance Industries is all set to monetize Reliance Retail in a big way. Reliance Industries announced that Singapore’s sovereign wealth fund GIC and TPG Capital had invested a combined Rs.7350 crore in Reliance Retail.

As of striking this deal, Reliance had already raised close to $2 billion from global investors, including KKR, Mubadala, General Atlantic and Silver Lake Partners. All these names had also invested in the Jio Platforms stake sale by RIL.

The Government Investment Corporation of Singapore or GIC will invest Rs.5512 crore for a 1.22% stake in Reliance Retail Ventures. At the same time, TPG Capital will invest Rs.1838 crore for a smaller 0.41% equity stake in RRVL.

Most of the PE deals for Reliance Retail Ventures have happened at a valuation of around $58-60 billion. This is little lower than the valuation assigned to Jio Platforms at $68 billion by the PE funds, not counting the strategic investments by Google and Facebook.

Reliance current has a portfolio of 12,000 stores across India and had recently committed Rs.25,000 crore for acquiring Future Group's retail business. RIL plans to take on the combined might of Amazon and Wal-Mart in a big way.

It now appears that the tables are reversing. For the last 10 years, it was oil and petchem that bankrolled the big investments into telecom, digital and retail. Now the equity currency is being used to bankroll the new energy and life sciences plans of Reliance group.