Diverse marquee
investors are becoming long-term shareholders of Jio Platforms because of a
unique set of technologies and platforms under one entity.
Illustration: Dominic Xavier
Reliance Industries on
Friday announced the sale of a 2.32 per cent stake in its digital unit to US
private equity giant KKR for Rs 11,367 crore, the fifth deal in four weeks that
will inject a combined Rs 78,562 crore in the oil-to-telecom conglomerate to
help it pare debt.
This is KKR's largest investment in Asia.
"This
transaction values Jio Platforms at an equity value of Rs 4.91 lakh crore and
an enterprise value of Rs 5.16 lakh crore.
“This
is KKR's largest investment in Asia and will translate into a 2.32 per cent
equity stake in Jio Platforms on a fully diluted basis," the company said
in a statement.
The
deal follows Facebook picking up a 9.99 per cent stake in the firm, housing
India's youngest but largest telecom company, on April 22 for Rs 43,574 crore.
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 8, US-based Vista
Equity Partners bought 2.32 per cent stake in Jio Platforms for Rs 11,367 crore.
On May 17 global equity
firm General Atlantic picked up 1.34 per cent stake in Jio Platforms for Rs
6,598.38 crore.
"Over the last month,
leading technology investors, such as, Facebook, Silver Lake, Vista, General
Atlantic and KKR have announced aggregate investments of Rs 78,562 crore into
Jio Platforms," it said.
Diverse marquee investors
are becoming long-term shareholders of Jio Platforms Ltd (JPL) because of a
unique set of technologies and platforms under one entity.
There are no similar
opportunities available anywhere else globally.
Investments by leading
global growth investors will enable Jio to scale its ecosystem and reaffirm the
firm as a next generation software product and platform company.
"Jio Platforms, a
wholly-owned subsidiary of Reliance Industries, is a next-generation technology
platform focused on providing high-quality and affordable digital services
across India, with more than 388 million subscribers," the statement said.
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 (total enterprise value) in tech companies,
and its technology portfolio currently has more than 20 companies across the
technology, media and telecom sectors.
In addition, India has been
a key strategic market for KKR with a history of investing in the country since
2006.
Mukesh Ambani, chairman and
managing director of Reliance Industries, said, "I am delighted to welcome
KKR, one of the world's most respected financial investors, as a valued partner
in our onward march to growing and transforming the Indian digital ecosystem
for the benefit of all Indians."
KKR, he said, has a proven
track record of being a valuable partner to industry-leading franchises and has
been committed to India for many years.
"We are looking
forward to leveraging KKR's global platform, industry knowledge and operational
expertise to further grow Jio."
Henry Kravis, co-founder
and co-CEO of KKR, said, "Few companies have the potential to transform a
country's digital ecosystem in the way that Jio Platforms is doing in India,
and potentially worldwide.
“Jio Platforms is a true
homegrown next generation technology leader in India that is unmatched in its
ability to deliver technology solutions and services to a country that is
experiencing a digital revolution."
"We are investing
behind Jio Platforms' impressive momentum, world-class innovation and strong
leadership team, and we view this landmark investment as a strong indicator of
KKR's commitment to supporting leading technology companies in India and Asia
Pacific," he said.
KKR is making the
investment from its Asia private equity and growth technology funds.
The transaction is subject
to regulatory and other customary approvals.
Morgan Stanley acted as
financial advisor to Reliance Industries, and AZB & Partners and Davis Polk
& Wardwell acted as legal counsel.
Deloitte Touche Tohmatsu
India LLP acted as financial advisor to KKR.
Shardul Amarchand Mangaldas
& Co and Simpson Thacher & Bartlett LLP acted as legal counsel to KKR.
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