As RIL’s retail subsidiary Reliance Retail Ventures Limited (RRVL) agreed to buy a 100% stake in Metro Cash & Carry for Rs 2,850 crore, Reliance Industries’ share price increased by 0.5% to Rs 2,604. The Mukesh Ambani-led company’s position in India’s retail industry will be strengthened by the action. The announcement follows the retail division of the conglomerate’s announcement of the introduction of their FMCG brand, “Independence.”
Reliance Retail, owned by Mukesh Ambani, said in a statement: “Through this acquisition, Reliance Retail gets access to a wide network of METRO India stores located in prime locations across key cities, a large base of registered kiranas and other institutional customers, strong supplier network, and some of the global best practises implemented by METRO in India. Reliance Retail stated in a regulatory filing that the acquisition will increase their physical store presence and footprint, enabling them to “better serve consumers and small merchants by leveraging synergies and efficiencies across supply chain networks, technology platforms, and sourcing capabilities.” The acquisition is anticipated to close by March 2023, provided that normal closing conditions and certain regulatory requirements are satisfied.
Metro India began operating in India in 2003 and now provides services to kiranas and small companies all throughout the nation. In the fiscal year 2021–2022, the company reported sales of Rs 7,700, representing its best performance to date. The nation’s first enterprise to use the cash-and-carry business model is Metro India, which presently employs roughly 3,500 people and operates 31 big format stores in 21 cities. According to a Reliance regulatory filing, the multi-channel B2B cash-and-carry wholesaler in India has a reach of over 3 million B2B clients, 1 million of whom are regular consumers through its store network and eB2B app.
With more than 15,000 outlets spread across more than 7,000 cities, Reliance Retail is the largest brick-and-mortar retailer in India and the industry’s fastest-growing company. As all of the promoters together own 76.98% of the firm and regulatory standards do not permit the overall promoter holding to surpass 75%, RRVL announced a 2% stake sale in Just Dial on Wednesday to achieve the minimal public shareholding.
“With Metro India, we are offering a lucrative and expanding wholesale operation in a rapidly changing market. According to Metro AG CEO Steffen Greubel, “We are confident that in Reliance we have found a competent partner that is ready and able to successfully take Metro India into the future in this market situation.
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