TIL Desk/Business/Mumbai/ The reevaluation of the decision to sell a 20 per cent stake in Reliance Industries Ltd’s oil-to-chemical business to Saudi Aramco will not impact the firm’s credit quality, Moody’s Investors Service said Tuesday.
On November 19, the conglomerate announced that it will reevaluate the transfer of its oil-to-chemical (O2C) business – comprising its refining, marketing and petrochemical operations – to a wholly-owned subsidiary.
The proposed business reorganisation was intended to enable RIL to sell a stake in its O2C segment to strategic investors, including Saudi Arabian Oil Company (Aramco).
“The sale would have strengthened the company’s balance sheet and liquidity as it continues to incur capital spending for its digital services, and new energy and retail businesses,” Moody’s said in a note.
“The decision to reevaluate the transfer and the stake sale will not impact RIL’s credit quality because the company already has a strong balance sheet to accommodate future investments required for its various businesses.” RIL has a rating downgrade trigger of net debt/EBITDA of 3.0x, but the company reported a net cash position as of September 30, 2021.
