The Silver Lake investment in Reliance Jio values Jio Platforms at an equity value of Rs 4.90 lakh crore and an enterprise value of Rs 5.15 lakh crore and is at a 12.5 per cent premium to the Facebook valuation.
American private equity firm Silver Lake Partner will invest Rs 5,655.75 crore Jio Platforms, a wholly-owned subsidiary of Reliance Industries (RIL). The announcement comes days after the mega-deal of Reliance Jio with Facebook. The Silver Lake investment in Reliance Jio values Jio Platforms at an equity value of Rs 4.90 lakh crore and an enterprise value of Rs 5.15 lakh crore and is at a 12.5 per cent premium to the Facebook valuation. According to the deal announced last month, Facebook agreed to buy a 9.99 per cent equity stake in Mukesh Ambani’s Reliance Jio for Rs 43,574 crore. Both the companies also agreed to let Reliance Retail use WhatsApp as part of its ‘New Commerce’ business.
Silver Lake Partners has investments in Airbnb, Alibaba, Ant Financial, Alphabet’s Verily and Waymo units, Dell Technologies, Twitter and other global technology leaders. “Silver Lake has an outstanding record of being a valuable partner for leading technology companies globally. We are excited to leverage insights from their global technology relationships for the Indian Digital Society’s transformation,” Mukesh Ambani, Chairman and Managing Director, Reliance Industries Ltd, said. Morgan Stanley acted as financial advisor to Reliance Industries for the deal.
Reliance Jio net profit for the March quarter nearly tripled to Rs 2,331 crore, from Rs 840 crore in the same period a year ago. Jio’s subscriber base stood at 38.75 crore as on 31 March 2020, a 26.3% on-year growth. After the mega-deal with Reliance Jio, Facebook looks to further its commerce plan as the country has about 6 crore small businesses and a huge digital customer base of 1.3 billion users.
Meanwhile, Reliance Industries (RIL) share price was trading 2.86 per cent higher at Rs 1467.05 apiece on BSE in Monday’s otherwise weak market.