Investment firm KKR has invested US$750 million into Reliance Retail Ventures, a subsidiary of Reliance Industries, giving the US company a 1.28 per cent equity stake.
This is the second time this year KKR has invested in a digitally focused Reliance offshoot, having earlier taken a stake in Jio Platforms alongside Facebook.
Reliance Retail has around 12,000 stores across India operating in multiple categories, including fashion, electronics and grocery. But the aspect of the business that has attracted the attention of international investors is its digital transformation agenda.
The company is working on the digitisation of small and ‘unorganised’ merchants across the state, aiming to connect more than 20 million of them by giving them access to technology tools and an efficient supply chain infrastructure. The initiative is dubbed New Commerce strategy and will link farmers and micro, small and medium enterprises (MSMEs) with global multinationals and domestic companies as preferred partners.
KKR co-founder Henry Kravis said deepening KKR’s relationship with Reliance will help fundamentally change the retail experience for Indian consumers.
“Reliance Retail’s New Commerce platform is filling an important need for both consumers and small businesses as more Indian consumers move to shopping online and the company offers tools for Kiranas to be a critical part of the value chain. We are thrilled to support Reliance Retail in its mission to become India’s leading omnichannel retailer and ultimately to build a more inclusive Indian retail economy.”
Mukesh Ambani, chairman and MD of Reliance Industries, said KKR has a proven track record of being a valuable partner to industry-leading franchises and has been committed to India for many years. “We look forward to working with KKR’s global platform, industry knowledge and operational expertise across our digital services and retail businesses.”
As at the end of June, KKR had $222 billion in assets under management and is building its involvement in companies focused on technology and digital transformation, including GoJek, Epic Games, OutSystems, Internet Brands and Voyager Innovations. It has private equity investments in more than 15 Indian companies, including Jio Platforms, JB Chemicals, Max Healthcare and Eurokids International.