ADAG's group firm Reliance Capital Trustee has bought 8.68% stake in Trent Limited for Rs.21.2 crore, marking the ADA Group’s entry into the retail sector.

The cumulative compulsorily convertible preference shares of Trent were bought by Reliance Capital Asset Management through various mutual fund series, including Reliance Equity Linked Saving Fund Series-I, Reliance Dual Advantage Fixed Tenure, Reliance Equity Opportunties Fund and Reliance Tax Saver Elss Fund.

Transaction Reference: ET

Trent Ltd (Trent) is a leading retailer and a part of the Tata Group. It commenced its business as “LAKME Limited” and in 1996, transferred its cosmetic business and its subsidiary to Lakme Lever Ltd, a joint venture (50:50) with Hindustan Lever Limited (HLL). In 1998, it acquired Littlewoods International (India) Pvt Ltd (LIIPL) and with the amalgamation of Lakme with LIIPL, the merged entity became “Trent Ltd”.

Trent owns 'Westside' (lifestyle stores), a chain of department stores across India and is also increasing its foothold in hypermarket space thorugh its 'Star India Bazaar' format (value store).

Trent is also into books and music retailing space through its subsidiary 'Landmark Limited'.

Trent has a JV with Spain's Inditex Group to develop 'Zara Stores' in India. Trent's sourcing, warehousing, clearing and forwarding need are met by its subsidiary 'Fiora Services Limited'.

On a consolidated basis Trent reported a PAT of Rs.1.5 crore on revenues of Rs.1120.5 crore in FY'10 as compared to a PAT of Rs.0.21 crore on revenues of 850.9 crore in FY'09.

This year in April, Trent raised $22mn (Rs.100 cr) through private placement of secured redeemable non-convertible debentures.

Reliance Cap’s stake buy in Trent comes three months after Anil and his elder brother Mukesh Ambani scrapped a non-compete agreement in May that allowed each other to enter in areas, which were hitherto not allowed due to a family settlement agreement struck in 2006.

Both brothers are entering in diversified busines including those where they were earlier prevented from entering each other’s businesses.

ADAG is planning to buy 26% stake in Indian Commodity Exchange (ICEX) from Indiabulls Financial Services.

In June, it bought 18% in Bloomberg UTV, the business channel promoted by Ronnie Screwvala and Bloomberg LP, for an undisclosed amount. Reliance Capital also owns 15% and 10% in Network 18 group and TV Today respectively, which run TV news channels in Hindi and English.

On the other hand, Mukesh recently acquired a 14.12% stake in East India Hotels (EIH) for Rs.1,021 crore and has done acquisitions worth another $3.6 billion (Rs.16,920 crore) in shale gas projects in the US. It is also planning to launch a $700-$800 mn infrastructure fund with global hedge fund DE Shaw.

Mukesh also entered in the broadband business by acquiring 95% stake in Infotel Broadband Services for Rs.Rs.4,800 Cr.

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