RIL executes definitive agreements for JV in textiles

Reliance Industries Ltd. | Refineries | Oil & Gas | BSE: 500325 | NSE: RELIANCE

10 Dec 2014 Evaluate

Reliance Industries (RIL) India and Shandong Ruyi Science and Technology Group Company, China (Ruyi), through its wholly owned subsidiary, have executed definitive agreements for a joint venture (JV) in textiles. As per the definitive agreements, 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% in the proposed JV, with the balance 49% owned by Ruyi. The proposed transaction is subject to obtaining requisite approvals.

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. Ruyi also operates in India under the ‘Georgia Gullini’ brand in the worsted suiting segment of the market.

The JV will build on RIL’s existing textile business and wide distribution network in India as well as 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.