The reports state that Reliance Retail is expected to drive the potential acquisition and Reliance is currently looking to pursue the deal independently, unlike others
With Chinese electronics and appliance manufacturer Haier looking to localise the business by partnering with a domestic company, Reliance Industries or RIL, has now emerged as a major contender for a substantial stake in the Indian operations of the company, as per the media reports.
Haier Appliances India is exploring a plan to dilute 25 per cent to 51 per cent of its equity. The media reports highlighted that the company is reportedly seeking a valuation of USD 2 to 2.3 billion, including a control premium. The move by Reliance sets it in a direct competition with a consortium that includes Sunil Mittal of the Bharti Group.
The reports added that Chinese companies have become more open to conditions requiring stake dilution in favour of Indian entities as they seek to expand in the country, following Donald Trump’s tariff crackdown.
With its advisors directly engaging with Haier’s headquarters in Qingdao, the reports added that Reliance entered the fray after non-binding offers were submitted earlier this year. According to the reports, Reliance Retail, the company’s retail arm, is expected to drive the potential acquisition. Unlike others, Reliance is currently looking to pursue the deal independently, the reports added.
With majority of Indian companies and private equity firms making it clear that they are unwilling to play a junior role in any partnership, the Chinese company is considering diluting 45 to 48 per cent of its equity to a local partner, with an additional three to six per cent reserved for Indian employees and local distributors, while retaining the remaining stake, as highlighted by the media reports.
