Update:
Reliance Industries Limited has denied any involvement with Alibaba Group for a joint venture with Reliance Retail. It has also denied any meeting between chairman Mukesh Ambani and Alibaba co-founder Jack Ma in July.
RIL has clarified its stance on some media reports which claimed that Alibaba Group is likely to invest around $ 5 billion in Reliance Retail to counter Amazon and Walmart's presence in the e-commerce space of India.
"There have been no discussions with Alibaba or with anyone else on acquiring a stake in Reliance Retail Limited. There was no meeting between our Chairman and Jack Ma in Mumbai in July-end," RIL said in a statement to International Business Times, India.
Chinese e-commerce giant Alibaba Group is reportedly in talks with Mukesh Ambani's Reliance Retail to form a mega Indian retail joint venture (JV). The Chinese company is reportedly likely to invest around $5 billion to counter Walmart-owned Flipkart and Amazon in the world's fastest growing e-commerce market.
Reliance Retail has received a proposal where Alibaba has shown its interest in acquiring a large stake in the company. It also plans to expand Alibaba's physical retail businesses in India.
The development is expected to further intensify the e-commerce market in India where Amazon and Walmart are investing heavily in this segment. With the entry of two deep-pocketed companies, the competition is expected to get stiffer.
Mint reported that Alibaba's executive chairman, Jack Ma had a meeting with Reliance Industries Ltd chairman Mukesh Ambani around July. The two businessmen discussed a number of issues, including a plan to create a large omnichannel retail entity through the proposed joint venture.
The deal seems to be crucial for the Chinese firm to increase its footprints in India after Reserve Bank of India (RBI) directed Paytm to stop on-boarding new customers due to the shareholding patterns of the company, reports Mint.
Alibaba holds a 49 percent stake in the company and could access the customer data. RBI has asked Paytm to introduce the additional layer of security to protect the data of its customers.
The e-commerce sector is becoming a hot market in India as it is attracting huge investments from retail giants across the world. Last week, Walmart announced the completion of its stake control of 77 percent in Flipkart.
Interestingly, in terms of revenue, Reliance Retail, a unit of Reliance Industries Ltd, is the largest retailer in India. It offers a diverse basket of FMCG goods such as food, groceries, apparels, lifestyle and home-care products, consumer electronics, farm implements.
Its retail outlets offer food, groceries vegetables, fruits and flowers. Apart from consumer goods, consumer durables, travel services, energy, entertainment and leisure, the outlet offers health and well-being products, apparels and lifestyle among other products.
