Mubadala, Silver Lake acquire Jio Platforms stakes for ₹13,640 crore
3 min read . Updated: 05 Jun 2020, 11:54 PM ISTThe Silver Lake and Mubadala deals give Jio an equity value of ₹4.91 tn and an enterprise value of ₹5.16 tn
MUMBAI : Reliance Industries Ltd (RIL) on Friday announced two large investments by foreign investors totalling ₹13,640.4 crore into Jio Platforms Ltd. With this, the digital services unit of RIL has raised ₹92,202.15 crore from top global investors in less than six weeks.
In the first transaction, Abu Dhabi-based Mubadala Investment Co. bought a 1.85% stake in Jio Platforms for ₹9,093.60 crore, becoming the sixth global investor in the digital services firm.
Later in the day, RIL said Silver Lake, which had invested ₹5,655.75 crore in Jio Platforms on 4 May, will invest an additional ₹4,546.80 crore, along with its co-investors, bringing its aggregate investment to ₹10,202.55 crore, for a 2.08% stake. The latest investments value Jio Platforms at an equity value of ₹4.91 trillion and an enterprise value of ₹5.16 trillion, the RIL statement said.
Starting with Facebook’s ₹43,574 crore investment in April, Jio Platforms has sold stakes to private equity firms KKR & Co., Silver Lake, Vista Equity Partners and General Atlantic.
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The high-value deals underscore the potential of India’s large, expanding base of telecom users and Jio’s leadership of this growing market. A fast-expanding online retail market in India is also giving hope to global firms about the prospects of this market.
“I am delighted that Mubadala, one of the most astute and transformational global growth investors, has decided to partner us in our journey to propel India’s digital growth towards becoming a leading digital nation," said Mukesh Ambani, chairman and MD of RIL. “We look forward to benefitting from Mubadala’s experience and insights from supporting growth journeys across the world."
“I would like to emphasise that Silver Lake’s additional investment in Jio Platforms, within a span of five weeks during the covid-19 pandemic, is a strong endorsement of the intrinsic resilience of the Indian economy, which will surely grow bigger with comprehensive digital enablement," Ambani said.
The flurry of deals by Jio Platforms will help RIL move closer to its aim of wiping out its net debt of ₹1.53 trillion (as in December 2019) by March next year. RIL’s debt has surged in the past few years, especially due to the aggressive expansion of Reliance Jio Infocomm Ltd.
This is Mubadala‘s largest investment in India so far. On 20 May 2017, Mubadala, in a consortium with other investors, made a $15 billion commitment to SoftBank CEO Masayoshi Son’s SoftBank Vision Fund, the biggest private fund ever raised of $100 billion. The fund invests and supports top firms and entrepreneurs building software, hardware, and internet platforms in areas such as connectivity, data analytics and artificial intelligence.
“We are committed to investing in, and actively working with, high growth companies which are pioneering technologies to address critical challenges and unlock new opportunities," said Khaldoon Al Mubarak, MD and group CEO, Mubadala. “We have seen how Jio has already transformed communications and connectivity in India, and as an investor and partner, we are committed to supporting India’s digital growth journey. With Jio’s network of investors and partners, we believe that the platform company will further the development of the digital economy."
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