Updated: November 20, 2021 2:12:07 am
Reliance Industries Ltd (RIL) and Saudi Aramco have decided to drop the latter’s mega plan to acquire 20 per cent stake in RIL’s oil-to-chemical business “in light of the changed context”.
“The current application with NCLT for segregating the O2C business from RIL is being withdrawn,” RIL said in a late-night announcement on Friday.
“RIL and Aramco have mutually determined that it would be beneficial for both parties to re-evaluate the proposed investment in O2C business in light of the changed context,” RIL said.
The decision is due to the “evolving nature of Reliance’s business portfolio”.
RIL and Aramco signed a non-binding letter of intent in August 2019 for a potential 20 per cent stake acquisition by Saudi Aramco in the O2C business of Reliance. “Over the past two years, both the teams made significant efforts in the process of due diligence, despite Covid restrictions. This has been possible due to the mutual respect and long-standing relationship between the two organisations,” RIL said.
Saudi Aramco was in advanced talks with RIL till recently to acquire the stake in RIL’s O2C business for about $ 15 billion (over Rs 1.11 lakh crore).
RIL had also recently announced the appointment of Aramco Chairman Yasir Othman H. Al-Rumayyan as an Independent Director of the company.
Jamnagar, which accounts for a major part of the O2C assets of RIL, is envisaged to be the centre for Reliance’s new businesses of renewable energy and new materials, supporting the net-zero commitment.
According to RIL, the deep engagement over the last two years has given both Reliance and Saudi Aramco a greater understanding of each other, providing a platform for broader areas of cooperation. “Saudi Aramco and Reliance are deeply committed to creating a win-win partnership and will make future disclosures as appropriate,” it said.
“RIL shall continue to be Saudi Aramco’s preferred partner for investments in the private sector in India and will collaborate with Saudi Aramco & SABIC for investments in Saudi Arabia,” RIL said.
According to RIL, Saudi Aramco and RIL have a very deep, strong and mutually beneficial relationship, that has been developed and nurtured by both companies over the last 25 years. Both companies are committed to collaborate and work towards strengthening the relationship further in the years ahead, it said.
RIL recently unveiled its plans for the new energy & materials businesses by announcing the development of Dhirubhai Ambani Green Energy Giga Complex at Jamnagar. It will be amongst the largest integrated renewable energy manufacturing facilities in the world.
The four Giga factories which will be part of the complex will include: an integrated solar photovoltaic module factory for production of solar energy, an advanced energy storage battery factory for storage of intermittent energy, an electrolyser factory for production of green hydrogen and a fuel cell factory for converting hydrogen into motive & stationary power.
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