General Atlantic invests Rs 6,600 cr in Reliance Jio; with investments from Facebook, Silver Lake, Vista Equity, platform raises Rs 67,194 cr in under 4 weeks
Jio Platforms on Sunday announced that it has sold a 1.34 percent stake to New York-based private equity firm General Atlantic for nearly Rs 6,600 crore, making it the fourth such stake sale in the last four weeks.
Jio Platforms on Sunday announced that it has sold a 1.34 percent stake to New York-based private equity firm General Atlantic for nearly Rs 6,600 crore, making it the fourth such stake sale in the last four weeks. With this investment, Jio Platforms has raised Rs 67,194.75 crore from leading technology investors including Facebook, Silver Lake, Vista Equity Partners and General Atlantic in less than four weeks.
Reliance Industries Limited (RIL) and Jio Platforms Limited had announced on 4 May that Silver Lake will invest Rs 5,655.75 crore into Jio Platforms. This investment values Jio Platforms at an equity value of Rs 4.90 lakh crore and an enterprise value of Rs 5.15 lakh crore and represents a 12.5 percent premium to the equity valuation of the Facebook investment announced on 22 April, 2020.
The deal comes less than two weeks after Facebook spent $5.7 billion to buy a 9.99 percent stake in Jio. The Facebook-Jio deal was the social media network’s biggest since its $22 billion buyout of WhatsApp in 2014.
The Silver Lake deal values Jio at $65 billion — a 12.5 premium to the value indicated by Facebook, which bought 9.99 percent of the digital unit of RIL.
Jio Platforms, a wholly-owned subsidiary of Reliance Industries Limited, is a next-generation technology company building a Digital Society for India by bringing together Jio’s leading digital apps, digital ecosystems and India’s Number 1 high speed connectivity platform under one umbrella. Reliance Jio Infocomm Limited, which provides connectivity platform to over 388 million subscribers, will continue to be a wholly-owned subsidiary of Jio Platforms.
RIL & Jio Platforms announce that Silver Lake will invest ₹5,655.75 cr into Jio Platforms. This investment values Jio Platforms at an equity value of ₹ 4.90 lk cr & an EV of ₹ 5.15 lk cr & represents a 12.5% premium to eq valuation of Facebook investment announced on April 22 pic.twitter.com/aAv6NOG99i
— CNBC-TV18 (@CNBCTV18Live) May 4, 2020
On 30 April, Reliance said, "In addition to the Facebook investment, the Board was informed that RIL has received strong interest from other strategic and financial investors and is in good shape to announce a similar sized investment in the coming months."
On 22 April, Facebook bought 9.9 percent stake in Jio Platforms for Rs 43,574 crore. That deal valued Jio at Rs 4.62 lakh crore ($65.95 billion).
Since its launch three years ago, Jio - led by billionaire Mukesh Ambani - has grown at a sprinter’s pace to become India’s largest telecom company. It has accumulated some 340 million customers through a barrage of innovations, including offering cut-throat mobile internet prices and a diverse suite of products and including chat services, movies, games and music.
Jio’s vision is to enable a Digital India for 1.3 billion people and businesses throughout India, especially small merchants, micro-businesses and farmers.
American private equity giant Silver Lake is the global leader in large-scale technology investing. Its mission is to build and grow great companies by partnering with world-class management teams. Its investments have included Airbnb, Alibaba, Ant Financial, Alphabet’s Verily and Waymo units, Dell Technologies, Twitter and numerous other global technology leaders.
Commenting on the transaction with Silver Lake, Mukesh Ambani, Chairman and Managing Director, Reliance Industries Ltd, said, “I am delighted to welcome Silver Lake as a valued partner in continuing to grow and transform the Indian digital ecosystem for the benefit of all Indians. Silver Lake has an outstanding record of being a valuable partner for leading technology companies globally. Silver Lake is one of the most respected voices in technology and finance. We are excited to leverage insights from their global technology relationships for the Indian Digital Society’s transformation.”
Commenting on the investment, Egon Durban, Silver Lake Co-CEO and Managing Partner, said, “Jio Platforms is one of the world’s most remarkable companies, led by an incredibly strong and entrepreneurial management team who are driving and actualizing a courageous vision. They have brought extraordinary engineering capabilities to bear on bringing the power of low-cost digital services to a mass consumer and small businesses population. The market potential they are addressing is enormous, and we are honored and pleased to have been invited to partner with Mukesh Ambani and the team at Reliance and Jio to help further the Jio mission.”
The transaction is subject to regulatory and other customary approvals.
(Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd which publishes Firstpost)
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