With Jio stake sale, RIL struck more sale deals in Q1 than in last 11 years

While the deal is smaller than the one with Facebook for 9.99 per cent stake, it comes at a 12.5 per cent premium
Mukesh Ambani promoted Reliance Industries (RIL)’s $15.20 billion worth stake sale in Jio Platforms, outperforms the combined value of sale and joint venture deals the company struck in the last 11 years.

According to data sourced from Bloomberg for RIL’s deal activity - which includes sale, purchase, investments and joint venture transactions, RIL undertook $22.30 billion worth of deal activity between FY2010 and FY2020. Of this $ 22.30 billion, Reliance Industries is identified as the acquirer only in $ 7.34 billion worth of deals. The rest, worth $ 14.95 billion, are either stake sales or joint ventures.

In terms of value, RIL’s June quarter deal (sales, purchase and joint venture included) activity, is more than 68 per cent of the conglomerate’s combined deal activity between FY2010 and FY2020.

The Covid-19 pandemic and the ensuing lockdown may have put the best of funds on a backfoot of deal activity, RIL, however, has been an outlier. With 10 different investors brought in for its telecom venture Jio Platforms, RIL undertook 12 different transactions since April this year. In all, these 12 transactions were valued at $ 15.27 billion, which also includes two smaller non-telecom related deals. RIL’s dozen deals transacted in the June quarter, outperform the company’s annual deal activity for 7 out of the last 11 years.

FY2011 and FY2020 were other two years where RIL saw heightened M&A activity in value terms. Deals in FY2020, included investments made in RIL’s infrastructure investment trust (InvIT)s for its tower assets and a joint venture with BP for fuel retailing. In 2011, RIL entered into a $7 billion joint venture with BP for its exploration and production business.

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