Two US companies buy stake in Jio Platforms for a total of Rs 6,440 crore
Reliance said with the latest deals, it has raised over Rs 1 lakh crore from leading global investors, including social media giant Facebook.
Reliance Industries on Saturday announced that it had sold a 0.93% stake in its digital services arm Jio Platforms to American investment company TPG Capital for Rs 4,546.80 crore. The multinational conglomerate said that with the latest deal, it has raised over Rs 1 lakh crore from leading global investors, including social media giant Facebook.
“Global alternative asset firm TPG will invest Rs 4,546.80 crore in Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore,” Reliance said in a statement. “With this investment, Jio Platforms has raised Rs 102,432.45 crore from leading global technology investors including Facebook, Silver Lake, Vista Equity Partners, General Atlantic, Mubadala, Abu Dhabi Investment Authority, and TPG since April 22, 2020.”
Reliance also announced that L Catterton, another US-based capital market company, will buy a 0.39% stake in Jio Platforms for Rs 1,894.50 crore.
The deals with global investors will enable Reliance Industries to completely eliminate its net debt by the end of 2020-’21, according to reports. At the end of the March quarter, Reliance’s debt stood at Rs 3,36,294 crore while its cash in hand was 1,75,259 crore. After adjusting cash, the net debt came to Rs 1,61,035 crore.
Reliance Industries Chairperson Mukesh Ambani said the deal with TPG was part of his company’s efforts to digitally empower Indians. “We have been impressed by TPG’s track record of investing in global technology businesses which serve hundreds of millions of consumers and small businesses, making the societies we live in better,” he was quoted as saying by Reliance in its statement.
TPG Co-Chief Executive Officer Jim Coulter, meanwhile, praised Jio Platforms for being a pioneer for all technology companies. “Jio is a disruptive industry leader that is empowering small businesses and consumers across India by providing them with critical, high-quality digital services,” he said. “The company is bringing unmatched potential and execution capabilities to the market, setting the tone for all technology companies to come.”
“We are excited to partner Reliance to invest in Jio,” Coulter added. “As an investor in growth, change, and innovation for over 25 years – and with a longstanding presence in India – we are excited to play an early role in Jio’s journey as they continue to transform and advance India’’s digital economy.”
In April, Facebook had bought a 9.99% stake in Reliance-owned Jio Platforms for $5.7 billion, or Rs 43,574 crore. Ambani had said that the main focus of the deal was to come up with digital based solutions for 60 million micro, small and medium businesses, 120 million farmers, 30 million small merchants and millions of small and medium enterprises in India.