Billionaire Mukesh Ambani’s oil-to-telecom conglomerate Reliance Industries has raised a record Rs 1.04 lakh crore in less than eight weeks from sale of minority stakes in its digital unit Jio Platforms to marquee investors.
On Saturday evening, it announced sale of 0.93 per cent in Jio Platforms to global investment firm TPG for Rs 4,546.80 crore and 0.39 per cent to private equity firm L Catterton for Rs 1,894.50 crore.
With these, Reliance has now sold 22.38 per cent of Jio Platforms to investors including Facebook Inc, securing Rs 104,326.95 crore in less than eight weeks, a company statement said.
The investments in Jio Platforms, which comprises the firm’s telecoms arm Reliance Jio Infocomm and its music and video streaming apps, give the unit an enterprise value of Rs 5.16 lakh crore, it said.
It has literally been an investment spree into Jio Platforms ever since Facebook announced its Rs 43,573.62 core infusion on April 22.
Besides Facebook, Reliance has attracted some of the leading global investment powerhouses at a time when the world is deeply impacted by the coronavirus pandemic resulting in a recession kind of environment for the global economy.
Including Facebook, nine marquee investors on a combined basis hold 22.38 percent stake in Jio Platforms. Facebook holds the largest stake at 9.99 per cent.
Within days of that deal, Silver Lake — the world’s largest tech investor — bought a 1.15 per cent stake in Jio Platforms for Rs 5,665.75 crore on May 4. It infused another Rs 4,546.80 crore for additional 0.93 per cent stake on June 5, taking its total holding to 2.08 per cent.
Private equity players KKR and Vista Equity Partners have taken 2.32 per cent stake each for Rs 11,367 crore apiece. KKR invested in Jio Platforms on May 22 while Vista invested on May 8.
Abu Dhabi sovereign wealth fund Mubadala Investment Co picked up 1.85 per cent in Jio Platforms for Rs 9,093.60 crore on June 5. Abu Dhabi Investment Authority (ADIA) on June 7 invested Rs 5,683.50 crore for a 1.16 per cent stake.
On May 17, global equity firm General Atlantic picked up 1.34 per cent stake in Jio Platforms for Rs 6,598.38 crore.
Reliance Jio is India’s biggest telecoms firm by subscribers, with more than 388 million users. It has forced out several rivals and driven consolidation in the sector since entering the market in 2016 with free voice services and cut-price data.
“Jio is a disruptive industry leader that is empowering small businesses and consumers across India by providing them with critical, high-quality digital services,” said Jim Coulter, co-CEO of TPG — which has more than USD 79 billion of assets under management including investments in technology companies like Airbnb, Uber and Spotify.
The Jio Platforms deals, along with a Rs 53,124 crore rights issue, will help Reliance meet its target of paying off Rs 1.61 lakh crore of net debt by the end of the year, according to the company.
L Catterton, which has a partnership with French luxury group LVMH and investment firm Groupe Arnault, concentrates on consumer-focused brands such as Peloton, Vroom, ClassPass, Owndays and FabIndia.
Established in 1976, ADIA is a globally-diversified investment institution that invests funds on behalf of the Government of Abu Dhabi through a strategy focused on long-term value creation.
Mubadala invests in transformative information and communications technology which include cognitive computing, ICT infrastructure, telecoms, and satellite operations.
With USD 40 billion in combined assets under management and committed capital, Silver Lake is the world’s largest tech investor. It has invested in some of the largest and most successful tech companies globally such as Twitter, Airbnb, Alibaba, Dell Technologies, Ant Financial, Twitter, Alphabet’s Waymo and Verily.
Founded in 1976, KKR has a long history of building leading global enterprises and successfully investing in businesses in the technology sector, including BMC Software, ByteDance and GoJek through its private equity and technology growth funds. Since inception, the firm has invested over USD 30 billion in tech companies.
General Atlantic has a long-standing tradition of backing disruptive entrepreneurs and companies around the world, including Airbnb, Alibaba, Ant Financial, Box, ByteDance, Facebook, Slack, Snapchat, Uber and other global technology leaders.
Vista is a leading global investment firm focused on empowering and growing enterprise software, data and technology enabled companies. It has more than USD 57 billion in cumulative capital commitments and its global network of companies collectively represent the fifth largest enterprise software company in the world.