reliance industries limited: RIL reboots Aramco deal, to re-evaluate structure after new energy forays
- RIL wants to sell 20% stake in oil refinery and petrochemical business
- $15 billion deal
- RIL has missed the self-determined deadline twice
The deal between Reliance Industries Limited (RIL) and Saudi Arabian company Saudi Aramco has not gone into cold storage yet. RIL has announced a revaluation of a proposed $15 billion deal to sell a 20 percent stake in its oil refinery and petrochemicals business to Saudi Aramco. Prior to this, Reliance Industries has missed the self-determined deadline twice for this deal. Reliance Industries on Friday said both the companies have agreed to re-evaluate the proposed investment in view of the Indian firm’s entry into new energy business.
The news of stake sale talks was first officially revealed in August 2019. Meanwhile, Reliance entered the new energy business by investing $10 billion in alternative energy in three years. In view of this the deal is being re-evaluated.
Both companies committed to a beneficial partnership
RIL said in a statement, “Due to the evolving nature of the company’s business portfolio, Reliance and Saudi Aramco have mutually decided that O2C (from oil to chemicals) business in view of the changed context for both the parties.” It would be beneficial to re-evaluate the proposed investment in
“The deep engagement of the last two years has given both Reliance and Saudi Aramco a greater understanding of each other, providing a platform for wider areas of cooperation. Saudi Aramco and Reliance remain committed to building a mutually beneficial partnership and will make future disclosures as appropriate.” The talks between RIL and Saudi Aramco could now include the new Swachh initiative announced by the Mukesh Ambani-led company.
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Withdrawal of application for separation of O2C business
Reliance has also said that the application made before the National Company Law Tribunal (NCLT) for demerger of the O2C business is being withdrawn. RIL had filed a proposal for demerger of its O2C business before the NCLT in Mumbai and Ahmedabad and had earlier said it expected to get the nod by the second quarter of 2021-22. RIL said that both the entities made significant efforts in the process of due diligence despite the COVID restrictions.
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