Merger of Reliance Industries

Do you the initial capital of Reliance?

Do you know the Net worth of Reliance

Industries?

$ 22 billion

Rs 15,000

1958

2016

ORGANIC
GROWTH

1958

INORGANIC GROWTH

1988
2016

The Birth of Reliance Industries

In May 1973, a company named as Mynylon Limited
was incorporated in Karnataka to manufacture
synthetic blended yarns and fabrics
In February 1975, a company by the name Reliance
Textile Industries Limited(RTIL) was incorporated in
Maharashtra.
On 1stJuly, 1975 RTIL was merged with Mynylon
Limited and name of Mynylon was changed to
Reliance TextileIndustries Limited (RTIL). Thus, one
can see that the birth of todays RIL

Merger of RIL and RPL

In 1987, Reliance Group had incorporated a company named
Reliance Petrochemicals Limited (RPL) to develop the first
phase of its Hazira Complex
This company came out with apublic issue of
approx. 74.93 crore equity shares of Rs. 10/- face
value at parto raise Rs.749. 28 crore to part
finance this phase I of Hazira Complex.
The merger, which happened on 1st March 1992,
had a swap ratio of 1:10.Shareholders of RPL
were issued, for every 10 shares of RPL, one
share ofRIL. In a way, this was a backdoor
premium issue by RIL

ILLU and PILLU

In 1992, Reliance Group had set up Polyethylene Limited
(RPEL) and Reliance Polypropylene Limited(RPPL). These
companies, which were popularly known as Illu and Pillu
The cost of one equity share of RPEL worked out to Rs. 14.31
to promoters whereas the same was Rs. 34.13 to the public. In
case of RPPL, these numbers were respectively Rs. 16.61 and
Rs. 33.61.
In financial year 1994-95, these companies were merged with
RIL with a swap ratio of 1:4 in case of RPEL and 3:10 in case
of RPPL
As a consequence, the equity capital of RIL went up only by
approx. Rs. 99 crore but with a whopping addition of approx.
Rs.700 crore to its reserves.

Reliance Petroleum Ltd

In 1993, Reliance Petroleum Limited (RPL), was set up
It posted a sterling performance in the first full year of operations
i.e. 2000-01 with the turnover crossing Rs. 30000 crore and net
profit of Rs. 1464 crore to become the largest private sector
company in India, ahead of RIL.
RPL was merged with RIL in 2002. The process as completed with
RIL allotting shares of RIL to shareholders of RPL in
October 2002 in the ratio of 1:11.
RILs equity capital went up by only Rs. 343 crore, amalgamation
added approx. Rs. 11950 crores to its reserves.
RILs turnover in 2001-02, which would have been approx. Rs.
24000 crore, shot up to Rs. 57000 crore on account of
RPLsturnover of Rs. 33000 crore, making it the largest private
sector company in India

IPCL
In 2002-03, RIL had acquired 46% stake in IPCL through its
investment company Reliance Petro Investments Limited at
the cost of approx. Rs. 2638 crore.
In March 2007, RIL announced IPCLs merger with itself
retrospectively from 1st April 2006 and with the swap ratio of
1:5.
This merger led to RIL equity capital going up by just Rs. 60
crores while its reserves shooting up by approx. Rs. 5460
crores.
It also added approx. Rs. 12000 to 13000 crore to the turnover
of RIL in 2006-07