Reliance Industries down 4% on calling-off Saudi Aramco deal
Published On: Monday, November 22, 2021 | By: Team KnowMyStock
Reliance Industries (RIL) share price fell 4 percent in early trade on November 22 after the company and Saudi Aramco decided to re-evaluate the proposed investment in the O2C business in light of the former's energy forays. The two companies had signed a non-binding letter of intent in August 2019 for a potential sale of a 20 percent stake in RIL’s O2C business to Saudi Aramco for $15 billion. With today’s intra-day fall, the stock of RIL has declined 14 percent from its record high level of Rs 2,750 touched on October 19, 2021. Due to evolving nature of Reliance’s business portfolio, Reliance and Saudi 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. Consequently, the current application with NCLT for segregating the O2C business from RIL is being withdrawn, RIL said in a statement.
RIL shall continue to be Saudi Aramco’s preferred partner for investments in the private sector in India, and will collaborate with Saudi Aramco and chemical manufacturer SABIC for investments in Saudi Arabia, it said.
The news could be a sentiment-negative for RIL stock price, said JPMorgan. This would, however, have limited impact, given that deleveraging at Reliance is done, it said.
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