Reliance and Saudi Aramco mutually call off proposed O2C deal; what should be your next course of action

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. 

Reliance Industries Limited and Saudi 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. 

Reliance 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.

Jamnagar, which accounts for a major part of the O2C assets, is envisaged to be the centre for Reliance’s new businesses of Renewable Energy & New Materials, supporting the NetZero commitment. 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 withdraw. 

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. 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. 

On Friday the stock closed at Rs 2473.30 up by 0.38 per cent on NSE. On a weekly basis the stock has plunged 4.62 per cent. The level of Rs 2450 is an important support level for the stock.