Private equity firm General Atlantic is picking up 1.34 per cent stake in Jio Platforms by investing Rs 6,598.38 crore in the wholly-owned subsidiary of Mukesh Ambani's Reliance Industries. This will be the fourth such big investment Jio Platforms has received in as many weeks.
Social networking giant Facebook and private equity firms Silver Lake, Vista Equity Partners and General Atlantic, have now in total invested Rs 67,194.75 crore in Jio Platforms.
Jio Platforms primarily houses Reliance’s telecom company Jio and its digital ecosystem, including broadband connectivity, smart devices, cloud computing, internet of things and blockchain.
Jio, which began operations in 2016, is India’s largest telecom player with 388 million subscribers. The investment by General Atlantic values Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore.
“As long-term backers of global technology leaders and visionary entrepreneurs, we could not be more excited about investing in Jio. We share Mukesh’s conviction that digital connectivity has the potential to significantly accelerate the Indian economy and drive growth across the country,” said Bill Ford, CEO of General Atlantic.
Some of the major tech companies that General Atlantic has backed include Airbnb, Alibaba, Ant Financial, Slack, Snapchat and Uber among others.
On April 22, Facebook had announced $5.7 billion (Rs 43,574 crore) investment to pick up a 9.99 per cent stake in Jio Platforms. On May 4, another private equity firm Silver Lake said it would pump Rs 5,656 crore in Jio Platforms for a 1.15 per cent stake. On May 8, Vista Equity Partners said it would invest Rs 11,367 crore in the company.
RIL has been betting big on its retail and telecom divisions, at a time a sharp crash in global oil prices impacts its traditional oil and gas and refining businesses.
The fundraising, which includes a huge Rs 53,125 crore rights issue and a planned 20 per cent stake sale in refining and petrochemicals business to Saudi Aramco, apart from a petroleum retailing joint venture inked last year with British energy company BP, will help RIL pare down its debt. At the end of March, RIL’s gross debt stood at Rs 336,294 crore, while net debt was at Rs 161,035 crore.
The rights issue will open for subscription of shareholders on May 20 and close on June 3. Mukesh Ambani had said in August last year that it plans to cut net debt to zero by March 2021.
