Reliance dismisses reports of $20 billion deal with Amazon
Last updated on February 15th, 2023 at 12:36 pm
Reliance Industries Ltd. has dismissed a report that it was planning to sell a $20-billion stake in its retail business to its American rival Amazon. The report was published by Bloomberg on Thursday stating that Mumbai-based RIL is willing to offer an approximate 40 percent stake in its subsidiary Reliance Retail Ventures Ltd. (RRVL) to Amazon for $20 billion, quoting an unidentified source with the information related to the development.
Based on its data, Bloomberg also stated that if a deal between Reliance and Amazon would be successful, it would create a “retail behemoth” in one of the fastest-growing consumer markets in the world, turning rivals Jeff Bezos and Mukesh Ambani into allies.
“At $20 billion, the deal would be the biggest ever in India as well as for Amazon,” Bloomberg said in its report.
However, declining the report, sources within Reliance told news agency AFP that “it makes no sense for both parties to establish partnerships or collaborations.”
Significantly, reports of a likely Reliance-Amazon deal led to a major surge of Reliance Industries share on the BSE by 7.14 percent to Rs 2,314.65 on Thursday. It further resulted in an increase of RIL’s market capitalisation hitting the Rs 15 lakh crore ($200 billion) mark, making the Mukesh Ambani-owned conglomerate the first-ever Indian company to achieve the feat.
After market hours, Reliance Industries issued a clarification over the reports saying: “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.” In the statement, the company further cautioned the media against publishing speculative news about potential transactions.
“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.”
Meanwhile, Amazon has denied to respond to media queries over the matter.
Reports of a possible Reliance-Amazon deal have come a day after RIL announced that US private equity firm Silver Lake Partners would buy a 1.75 per cent stake in its subsidiary Reliance Retail for Rs 7,500 crore, valuing the company at Rs 4.2 trillion. Amid the pandemic lockdown, Reliance Industries has been working its aggressive growth strategy across various platforms.
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