Amazon reportedly in talks to buy a 9.9% stake in India’s Reliance Retail

Amazon may join its global rivals Google and Facebook in backing one of Indian billionaire Mukesh Ambani’s ventures.

The American e-commerce giant is in preliminary talks to acquire a 9.9% stake in Reliance Retail, local TV news channel ET Now reported Thursday afternoon, citing unnamed sources.

Reliance Retail, founded in 2006, is the largest retail chain in India. It serves more than 3.5 million customers each week (as of early this year) through its nearly 10,000 physical stores in more than 6,500 cities and towns in the country.

Reliance Industries, which is the most valuable firm in India and operates Reliance Retail and Jio Platforms, declined to comment on the report. Amazon also declined to comment.

The reported talks between Amazon and Reliance Retail comes days after Ambani, who is India’s richest man, said several firms had expressed interest in backing the retail chain. Ambani’s other venture, Reliance Jio Platforms, has secured over $20 billion by selling 33% stake to more than a dozen investors, including Facebook, Google, Silver Lake and General Atlantic, since April this year.

During Reliance Industries’ annual general meeting earlier this month, Ambani said the company will “induct global partners and investors in Reliance Retail in the next few quarters.”

Reliance Industries’ new venture, JioMart, is increasingly becoming a new challenger to Amazon, which has invested more than $6.5 billion in its India business, and Walmart’s Flipkart in recent months. Facebook said in April that it had entered into an agreement with Reliance Industries to explore ways to collaborate on serving 60 million mom and pop stores in India.

Morgan Stanley, which served as the financial advisor to Reliance Industries for Jio Platforms’ deals, recently valued Reliance Retail at about $29 billion.

Both Amazon and Reliance Retail, according to local media reports, have also been locked in a battle to acquire a majority stake in Future Retail, India’s second-largest retail chain. Last year, Amazon invested more than $100 million to acquire a 49% stake in Future Coupons, a group entity owned by Future Retail.

That investment, which gave Amazon a 3.58% stake in Future Retail, also granted it the rights of first refusal to purchase more stake in Future Retail both directly as well as via entities, according to terms the two companies disclosed in a regulatory filing.

The two companies have also signed a “long-term business agreement” as part of which Future Retail sells some goods online through Amazon India marketplace.