Talks about the sale of a 20 per cent stake in Reliance Industries Ltd's (RIL) oil-to-chemical business to Saudi Aramco have stalled over the valuation, as the energy market has been hit by the COVID-19 pandemic, news agency Reuters reported on Thursday, quoting four sources familiar with the matter. Saudi Aramco wants Reliance Industries to review its price for the oil-to-chemical business as the global valuation of oil assets has tumbled due to falling demand for crude, one source said, according to the Reuters report.
Meanwhile, a second source said Aramco wanted to "revisit" the valuation, according to Reuters.
On Wednesday, while addressing the shareholders at RIL's 43rd annual general meeting (AGM), the company's chairman and managing director, Mukesh Ambani, said that that the Aramco deal had not progressed according to the scheduled timeline due to ongoing pandemic situation.
"Deal with Saudi Aramco hasn't progressed per original timeline due to unforeseen situation in the energy market and COVID-19 situation. We value our two-decade relationship with Aramco and are committed to long term partnership," Mr Ambani said. (Also Read: What Mukesh Ambani Said At 43rd Reliance AGM)
The Reliance Industries stock reacted negatively to the announcement, witnessing a sharp 5 per cent decline soon after, in Wednesday's intraday trading.
Reliance Industries shares extended losses on Thursday, declining as much as 1.81 per cent during the session before closing with a loss of 0.14 per cent at Rs 1,843.10 apiece on the BSE. The stock underperformed the benchmark Sensex which rose 1.16 per cent, primarily led by strong buying interest in IT shares.