News: Reliance seen raising VC fund for retail, realty foray
(TNN 28/04/2006) Mumbai - The Reliance group is believed to be putting together a venture capital fund which will support its foray into the retail and real estate sectors. The fund, which sources indicate may be called, Skill, may have an initial corpus of around Rs 500 crore, which may be scaled up later.
“It will be in the nature of an urban infrastructure fund to support the RIL group’s initiatives,” industry sources said. These sources said that the team working with Anand Jain, a close friend and business associate of RIL chairman Mukesh Ambani, will be in charge of the fund.
Mr Jain is handling RIL’s foray into building special economic zones (SEZ). He also handles RIL’s real estate activities. Informed sources said Reliance is working aggressively on having a sound back-end support system which includes sourcing and manufacturing for its retail foray, providing financing and also focuses heavily on real estate.
“It is a huge back-end strategy which is being put into place. They have also sought the help of a couple of foreign retail consultants to frame the plan. The focus is on being a big enable to a host of businesses, encourage enterpreneurship and small businesses and eventually consumption,” said a top industry official.
Sources said Reliance is trying to take a huge number of kirana-owners and small traders across the country under their wings and reach some sort of understanding on mutually profitable partnerships.
The Reliance fund may be used to support entrepreneurs who may interested in setting up shops in malls and multiplexes where RIL has a major presence or is an anchor tenant. Similarly it may fund businesses by new entrepreneurs in RIL’s own SEZs.
The fund is likely to be open for investments by outside investors as well as RIL promoters and associates. However details on the exact structure of the fund and the number of investors were not available.
On conditions of anonymity, senior Pantaloon officials said Reliance have structured their retail foray largely on the Pantaloon model.
The size of the Reliance foray is of course much larger with the company even looking at building small townships around their retail malls as a complete set-up. Industry sources said retail majors are extremely keen to also cash in on the real estate value in and around the malls.
“It will be in the nature of an urban infrastructure fund to support the RIL group’s initiatives,” industry sources said. These sources said that the team working with Anand Jain, a close friend and business associate of RIL chairman Mukesh Ambani, will be in charge of the fund.
Mr Jain is handling RIL’s foray into building special economic zones (SEZ). He also handles RIL’s real estate activities. Informed sources said Reliance is working aggressively on having a sound back-end support system which includes sourcing and manufacturing for its retail foray, providing financing and also focuses heavily on real estate.
“It is a huge back-end strategy which is being put into place. They have also sought the help of a couple of foreign retail consultants to frame the plan. The focus is on being a big enable to a host of businesses, encourage enterpreneurship and small businesses and eventually consumption,” said a top industry official.
Sources said Reliance is trying to take a huge number of kirana-owners and small traders across the country under their wings and reach some sort of understanding on mutually profitable partnerships.
The Reliance fund may be used to support entrepreneurs who may interested in setting up shops in malls and multiplexes where RIL has a major presence or is an anchor tenant. Similarly it may fund businesses by new entrepreneurs in RIL’s own SEZs.
The fund is likely to be open for investments by outside investors as well as RIL promoters and associates. However details on the exact structure of the fund and the number of investors were not available.
On conditions of anonymity, senior Pantaloon officials said Reliance have structured their retail foray largely on the Pantaloon model.
The size of the Reliance foray is of course much larger with the company even looking at building small townships around their retail malls as a complete set-up. Industry sources said retail majors are extremely keen to also cash in on the real estate value in and around the malls.
posted by InCar Group Press Room at 11:24
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