By Reuters
MUMBAI: Indian billionaire Mukesh Ambani鈥檚 Reliance Industries said it will spin off its consumer goods unit into a new entity to allow the fast-growing business to attract investors beyond those backing its retail unit.
Reliance鈥檚 consumer business includes brands such as Campa Cola, which competes with Coca-Cola and Pepsi, and dozens of other snacks and confectionery brands that fight for shelf space with the likes of Mondelez鈥檚 Cadbury chocolates.
India鈥檚 National Company Law Tribunal has approved the internal restructuring under which Reliance will transfer its consumer business from its retail arm into a direct subsidiary, New Reliance Consumer Products Ltd, according to an order dated June 25, which was first reported by Indian media on Thursday.
鈥淭his is a large business by itself requiring specialized and focused attention, expertise and different skill sets as compared to retail business,鈥 Reliance said in its request for approval to the tribunal, according to the order.
鈥淭his business also entails large capital investments on an on-going basis and can attract a different set of investors,鈥 it added.
The new entity will also include Reliance鈥檚 beauty business. Reliance Industries will hold an 83.56% stake in the entity. Reliance鈥檚 retail unit has separately been planning an IPO.
On Thursday, Reliance Retail announced a strategic minority investment in UK-based FACEGYM, a facial fitness and skincare company, without disclosing an investment amount.