Chinese e-commerce giant Alibaba Group Holding may pick up 50% stake in Reliance Retail Ltd for $5-6 billion (Rs 34,908-41,889 crore), Mint reported, citing people aware of the development. This, one of the people said, could result in a joint venture with the retail arm of Mukesh Ambani-led Reliance Industries Ltd, wherein Alibaba would hold a smaller stake.
Internet giant Alibaba’s deal, if it goes through, will pose a challenge to e-commerce players Flipkart and Amazon.
Alibaba Group has given the mandate to Goldman Sachs for advising on the proposed deal, according to the report.
A Reliance Industries spokesperson dismissed the report as speculative.
Reliance Retail is into retail business and operates a chain of neighbourhood stores, supermarkets, wholesale cash-and-carry stores and speciality stores.
In the consumer electronics category, it operates Reliance Digital, Reliance Digital Express Mini and Jio stores.
Separately, e-commerce giant Amazon is in advanced discussions to pick up 42-49% in Aditya Birla Retail Ltd’s More supermarket chain, Mint reported, citing three people aware of the development.
Amazon is joining hands with mid-market private equity firm Samara Capital for a complete buyout of More from the Aditya Birla Group for Rs 4,200-4,400 crore, the report added.
In another report, The Economic Times said, citing people, that Amazon is forming a consortium with Goldman Sachs and Samara Capital to acquire More at an enterprise valuation of Rs 4,500-5,000 crore.
Amazon, Goldman Sachs and Samara Capital are planning to incorporate an entity in which Amazon will have 49% stake, the report said.
Samara Capital and Aditya Birla Retail had entered into an exclusivity pact for negotiations in June, according to the report.
Aditya Birla Retail runs supermarkets and hypermarkets under the brand name of More, and is a privately held part of business conglomerate Aditya Birla Group.
Current norms in multi-brand retail allow foreign direct investment of up to 51%.
In another development, Italy’s Benetton family-controlled Atlantia, Singapore-based Cube Highways and Infrastructure and Canadian pension fund CDPQ are in separate talks to pick up 35-40% stake in Sadbhav Infrastructure Project Ltd, The Economic Times reported.
The deal is pegged at $350-400 million (Rs 2,500-2,800 crore), the report said, citing two people aware of the development.
Sadbhav Infrastructure is majority owned by another listed firm Sadbhav Engineering, which is into engineering, construction and development of infrastructure projects.
Sadbhav Infrastructure’s operations span across Maharashtra, Gujarat, Rajasthan, Karnataka, Haryana, Madhya Pradesh and Telangana, besides border check-posts in Maharashtra.
Sadbhav Infrastructure’s revenue from operations stood at Rs 2,276 crore for the year ended March 2018, up from Rs 1,348 crore for the previous financial year.
Update: The story has been modified to include a response from Reliance Industries.