RIL to transfer textile business to Ruyi Group of China

Comprehensive joint venture agreement signed

Reliance Industries Ltd. (RIL) and Shandong Ruyi Science and Technology Group Co. Ltd. of China have executed definitive agreements for a joint venture in textiles. Under the agreements, RIL will transfer its existing textile business into a newly-incorporated company, a joint venture, which will receive cash consideration. RIL will own a majority 51 per cent in the proposed JV, with the balance 49 per cent owned by Ruyi. The transaction is subject to obtaining requisite approvals.

RIL’s existing textile business is its founding business and operates under the well-known brand ‘Vimal’. It has its prominent presence in the Indian textile market, especially in the worsted and synthetic suiting fabric segments.

Ruyi, a leading textile company in China with revenues in excess of $3 billion, has its global presence, including in the US, Europe, Japan, Australia, New Zealand and China. Ruyi has a portfolio of world renowned brands such as Taylor & Lodge, Harris Tweed, Royal Ruyi China, Nogara Italy and Indios Italy. The Ruyi Group includes Renown Inc. founded in 1902, which owns or operates several leading global brands such as Aquascutum, Simple Life, Ensuite, Mano, addenda, CHARGE, next eye, D’urban and Intermezzo. It also operates in India under the Georgia Gullini brand in the worsted suiting segment of the market. The business operation and activities would get realigned to strengthen the proposed joint venture.

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 global reach. The JV which will benefit from the strength of the Vimal and Georgia Gullini brands plans to introduce some of the well-known global brands of Ruyi.

RIL is India’s largest private sector company with a consolidated turnover of Rs. 4,46,339 crores ($74.5 billion), cash profit of Rs. 33,980 crores ($5.7 billion) and net profit of Rs. 22,493 crores ($3.8 billion) for the year ended March 31, 2014.

RIL is the first private sector company from India to feature in Fortune’s Global 500 list of ‘World’s Largest Corporations’ and continues to be featured for the 11th consecutive year, currently ranking 114th in terms of revenues and 155th in terms of profits. As per Newsweek’s Green Rankings 2014, RIL is India’s greenest and most environment-friendly company, ranking 185th among the world’s largest 500 companies.

Ruyi, with revenue in excess of $3 billion, has a significant presence in China, Japan, Australia, Europe, America and Korea, among other regions across the globe. It has made investments in Japan, the UK and Australia in the recent past and has partnerships with global players such as Itochu of Japan. It also owns or operates a portfolio of world-renowned brands such as Taylor & Lodge, Harris Tweed, Nogara, Aquascutum, D’urban, etc.

With a view to expanding its international footprint, Ruyi has made significant investments in the UK, South Korea, China, Australia and New Zealand.