Investor demand for Reliance Industries Ltd’s retail business is so strong that Carlyle Group Inc and SoftBank Group Corp are among those placed on a waiting list, according to people familiar with the matter.
Carlyle and SoftBank have recently expressed interest in investing in Mukesh Ambani’s Reliance Retail Ventures Ltd, said the people, who asked not to be identified because the information is private. Reliance Industries has asked the two companies to wait on the sidelines as the Indian conglomerate is already in advanced talks with other financial investors, the people said.
Ambani is turning to sponsors from his digital services business, which has secured $ 20 billion in recent months, as he seeks funding for Reliance Retail. Silver Lake Partners, an investor in Jio Platforms Ltd, agreed last week to contribute $ 1 billion. Other Jio investors, including private equity funds KKR & Co and L Catterton, are also considering investing, Bloomberg News reported.
Abu Dhabi’s Mubadala Investment Co, which is also a Jio investor, is considering an investment of around $ 750 million in Reliance Retail, the people said. The Abu Dhabi Investment Authority and the Saudi Arabian Public Investment Fund are also considering investments, one of the people said.
The strong response from Jio’s financial investors means that there is not enough for others. Reliance Industries plans to sell about a 10% stake in Reliance Retail to financial investors and almost all of the $ 5.7 billion worth of stock has been absorbed, the people said.
The largest allocation is reserved for Amazon.com Inc., Bloomberg News reported last week. Ambani offers to sell an approximately $ 20 billion stake in the retail business to the American tech giant, which could amount to a 40% stake. A deal, if successful, would be the largest ever made in India and for Amazon, according to data compiled by Bloomberg.
Potential investors, including Carlyle and SoftBank, could still get their hands on the Reliance Retail stock should others cut back on their commitments, the people said. The negotiations are ongoing and could still be delayed or unraveled, the people said.
Representatives for Reliance, Carlyle, SoftBank, ADIA and Mubadala declined to comment, while representatives for PIF did not immediately respond to requests for comment.
Ambani has identified technology and retail as areas for future growth moving away from the energy businesses he inherited from his father, who died in 2002. Retail is the next frontier for the 63-year-old Indian tycoon, whose ambitions include creating a home. e-commerce giant like China’s Alibaba Group Holding Ltd.
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