Reliance Industries (RIL) has announced a joint venture with China’s Shandong Ruyi Science and Technology Group to “reposition its textile business on a high growth path”.
As part of the deal, Mukesh Ambani-run RIL will transfer its existing textile business into a newly incorporated company, for which RIL will receive cash consideration.
RIL will own a majority 51 per cent in the proposed JV, with the balance 49 per cent owned by Shandong Ruyi. The proposed transaction is subject to regulatory approvals.
However, RIL has not disclosed the cash consideration for the deal. “RIL’s existing textile business is the founding business of RIL and operates under the well-known brand ‘Vimal’. It has a prominent presence in the Indian textile market, especially in the worsted and synthetic suiting fabric segments,” RIL said in a statement.
The JV will build on RIL’s existing textile business and wide distribution network in India and Ruyi’s state-of-the-art technology and its global reach. The JV will benefit from the strength of the ‘Vimal’ and ‘Georgia Gullini’ brands and plans to introduce some of the well-known global brands of Ruyi. Qiu Yafu, chairman, Shandong Ruyi Group, said: “…we see our joint venture with Reliance as a significant event for the group. To enter the Indian market with Reliance we truly believe is the bright future of this joint venture business.”