After reports of Reliance Industries offering up to 40% stake in Reliance Retail to Amazon in a $20 billion deal, the corporate behemoth declined to comment on media speculations, but didn’t confirm or deny such talks.
Bloomberg reported the deal in the works on Thursday, and that Amazon has held discussions about investing in the retail arm of RIL and has expressed interest in negotiating a potential transaction, said a Bloomberg report. If fructified, this deal would be the largest in India and also Amazon’s largest deal till date.
It would also be among the largest foreign direct investments into India, according to analysts.
“In light of a high incidence of speculative media queries and incorrect and ex parte media articles relating to purported capital transactions into Reliance Industries or our group companies, we would like to reiterate that as a policy, we do not comment on media speculation and rumours and we cannot confirm or deny any transaction which may or may not be in the works. Our company evaluates various opportunities on an ongoing basis,” Reliance said in a filing with the Bombay Stock Exchange.
“Vide this communication, we appeal to the media to carefully examine any such speculative information and safeguard themselves and their readers, many of whom are individual retail investors, from publishing/recycling unfounded and/or incorrect news.”
As per the report, if the deal goes through, it will not only create a massive retail behemoth, turning Jeff Bezos and Mukesh Ambani into the biggest retail players in the country, it will also make the world’s richest man and Asia’s richest man into allies.
Bloomberg also reported that a deal with Amazon would aid Ambani in creating a massive e-commerce giant like China’s Alibaba Group Holding in India.
With this news and reports of other global investors eyeing Reliance Retail, Reliance Industries shares surged to touch a record high of Rs 2,343.9 on Thursday. Its market capitalisation is currently over Rs 14.67 lakh crore, the highest ever for any Indian company. The surge in the stock made Reliance industries the first ever Indian company to hit a market capitalisation of $200 billion.
In reply to an e-mail by IANS, an Amazon spokesperson said: "We do not comment on speculations of what we may or may not do in the future."
Earlier in July, RIL Chairman Mukesh Ambani had announced at the Annual General Meeting that global partners and investors will be brought into Reliance Retail in the next few quarters. He said that several strategic and financial investors have shown interest in Reliance Retail.
On Wednesday, RIL announced that Silver Lake will invest Rs 7,500 crore into its subsidiary RRVL for a 1.75% stake.