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MUMBAI: Following Facebook, US-based private equity firm Silver Lake will pay Rs 5.656 crore ($ 750 million) to acquire 1.15% in the digital and telecommunications unit of Reliance Industries (RIL). The Jio Platforms deal, Silver Lake’s largest investment in India, will help RIL accelerate its debt reduction plans.
The transaction values the Jio platforms at Rs 5.15 lakh crore ($ 69 billion), a 12% premium in terms of rupees to the business valuation implied by Facebook’s investment in the Indian company. On April 22, Facebook said it will spend Rs 43.574 billion ($ 5.7 billion) for a 9.99% stake in Jio Platforms, which owns India’s largest wireless operator.
Both deals, which come amid the pandemic-induced blockade, are subject to regulatory approvals.
In 2013 Silver Lake made its first investment in India through Eka Software Solutions, based in Bangalore. The fund’s investment in Jio Platforms sets a new price benchmark for the Indian company that will see more outside investors in the coming months. In its quarterly earnings comment on April 30, RIL said it has received interest from multiple global investors to buy additional stakes in Jio Platforms and that it would announce investments similar to the Facebook transaction.
In that context, while Silver Lake’s investment is positive, the size is very small compared to the Facebook deal, and therefore investors would like to see more major transactions on Jio Platforms, analysts at JP Morgan wrote in your research report.
While RIL has not specified the total amount of stake it intends to sell on Jio platforms to third parties, the share sales are part of President Mukesh Ambani’s broader plan to go public with the unit in the future. Last October, RIL placed all digital and telecom assets on its Jio 100% platforms to attract outside investors.
Foreign investors now have an 11.14% stake in Jio Platforms, a startup launched in late 2016 and which has become a force to be reckoned with within the telecommunications industry with 388 million subscribers.
The digital services business made an operating profit of Rs 14,363 crore on an annual income of Rs 68,462 crore, 64% and 41% more than in fiscal year 2019. RIL has launched an aggressive program to increase its balance sheet, which includes the sale of participations in its subsidiaries. , offer of rights and deceleration of new investments.
The country’s most valuable company, which is shifting its position from an energy-driven player to a consumer / technology-focused company, has a debt of Rs 3.36 lakh crore as of March 31, 2020. Ambani had said he plans to do RIL is a net debt free company by the end of this financial year.
Founded in 1999, Silver Lake, which manages assets worth $ 40 billion, is primarily committed to technology and technology opportunities. The fund has investments in Dell Technologies, Twitter, Airbnb and Alibaba, to name a few. Its investment portfolio collectively generates an annual income of more than $ 230 billion and employs 3.7 lakh people worldwide.
Silver Lake has an outstanding history of being a valued partner to the world’s top technology companies. We are excited to leverage the insights from its global technology relationships for the transformation of the Indian digital society, “said RIL President Ambani.
Jio Platforms is Silver Lake’s third deal in the last month after signing online travel reservations Expedia and home rental company Airbnb.
“The incredibly strong business management team at Jio Platform has brought extraordinary engineering capabilities to bring the power of low-cost digital services to a massive population of consumers and small businesses. 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 Reliance and Jio team, ”said Silver Lake Co-CEO Egon Durban.
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The transaction values the Jio platforms at Rs 5.15 lakh crore ($ 69 billion), a 12% premium in terms of rupees to the business valuation implied by Facebook’s investment in the Indian company. On April 22, Facebook said it will spend Rs 43.574 billion ($ 5.7 billion) for a 9.99% stake in Jio Platforms, which owns India’s largest wireless operator.
Both deals, which come amid the pandemic-induced blockade, are subject to regulatory approvals.
In 2013 Silver Lake made its first investment in India through Eka Software Solutions, based in Bangalore. The fund’s investment in Jio Platforms sets a new price benchmark for the Indian company that will see more outside investors in the coming months. In its quarterly earnings comment on April 30, RIL said it has received interest from multiple global investors to buy additional stakes in Jio Platforms and that it would announce investments similar to the Facebook transaction.
In that context, while Silver Lake’s investment is positive, the size is very small compared to the Facebook deal, and therefore investors would like to see more major transactions on Jio Platforms, analysts at JP Morgan wrote in your research report.
While RIL has not specified the total amount of stake it intends to sell on Jio platforms to third parties, the share sales are part of President Mukesh Ambani’s broader plan to go public with the unit in the future. Last October, RIL placed all digital and telecom assets on its Jio 100% platforms to attract outside investors.
Foreign investors now have an 11.14% stake in Jio Platforms, a startup launched in late 2016 and which has become a force to be reckoned with within the telecommunications industry with 388 million subscribers.
The digital services business made an operating profit of Rs 14,363 crore on an annual income of Rs 68,462 crore, 64% and 41% more than in fiscal year 2019. RIL has launched an aggressive program to increase its balance sheet, which includes the sale of participations in its subsidiaries. , offer of rights and deceleration of new investments.
The country’s most valuable company, which is shifting its position from an energy-driven player to a consumer / technology-focused company, has a debt of Rs 3.36 lakh crore as of March 31, 2020. Ambani had said he plans to do RIL is a net debt free company by the end of this financial year.
Founded in 1999, Silver Lake, which manages assets worth $ 40 billion, is primarily committed to technology and technology opportunities. The fund has investments in Dell Technologies, Twitter, Airbnb and Alibaba, to name a few. Its investment portfolio collectively generates an annual income of more than $ 230 billion and employs 3.7 lakh people worldwide.
Silver Lake has an outstanding history of being a valued partner to the world’s top technology companies. We are excited to leverage the insights from its global technology relationships for the transformation of the Indian digital society, “said RIL President Ambani.
Jio Platforms is Silver Lake’s third deal in the last month after signing online travel reservations Expedia and home rental company Airbnb.
“The incredibly strong business management team at Jio Platform has brought extraordinary engineering capabilities to bring the power of low-cost digital services to a massive population of consumers and small businesses. 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 Reliance and Jio team, ”said Silver Lake Co-CEO Egon Durban.
