According to sources, Reliance Industries Ltd (RIL) may have teamed up with private-equity investors for making a bid for the family’s equity.
NEW DELHI: Mukesh Ambani, it seems, is in the race to acquire an equity stake in the world’s second-largest retailer - Carrefour. The French retail major, in which the Halley family owns about a 13% stake, could be looking for a buyer.
According to sources, Reliance Industries Ltd (RIL) may have teamed up with private-equity investors for making a bid for the family’s equity.
While over 84% equity in Carrefour is held by the French public, and 2.2% is with employees. According to reports in the French media, the Halley family has asked two banks to find a buyer for its equity for between €55-60 per share, valuing the family’s stake between €5-5.5 billion.
It is well known that Mukesh Ambani is armed with a war chest of up to $14 billion and is evaluating several options in his bid to get a global retail footprint, having already begun in the domestic market with fruit and vegetable neighbourhood stores called Reliance Fresh.
But it could not be confirmed whether RIL is in the race to acquire equity in Carrefour or whether it is looking to only acquire significant equity in Carrefour’s logistics and supply-chain business.
An RIL spokesperson declined to comment. Meanwhile, sources also say that, apart from Carrefour, RIL has also been in negotiations with other well-known retail companies - Sainsbury and Marks & Spencer in Britain and Kmart and Target in the US - again for acquiring significant equity stakes.
The $80-billion Carrefour currently operates four main grocery store formats — hypermarkets, supermarkets, hard discount and convenience stores. It has over 12,000 stores, either company-operated or franchises. Carrefour’s plans to tie up with Bharti Enterprises in India soured last year and it was subsequently in talks with the Wadias of Bombay Dyeing for making an entry into the fast-growing Indian retail market. But whether RIL is eyeing only the supply-chain of Carrefour or a stake in the retail business, one thing is clear: RIL is banking on acquisitions to strengthen three critical areas for its global retail ambitions - front-end retail business, logistics and supply chain and sourcing.
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