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Abu Dhabi’s Mubadala to invest $1.2 bn in Reliance’s Jio Platforms, Silver Lake commits $600 mn more
Photo Credit: Shah Junaid/VCCircle

Reliance Industries Ltd said on Friday Abu Dhabi-based Mubadala Investment Company will invest Rs 9,093.60 crore ($1.2 billion) in Jio Platforms Ltd, as the Indian conglomerate roped in the sixth investor for its digital unit.

In addition, private equity firm Silver Lake Partners and its co-investors are putting in Rs 4,546.8 crore ($600 million) more in Jio Platforms than earlier announced, Reliance said in a statement.

Mubadala’s investment will translate into a 1.85% stake in Jio Platforms while Silver Lake's stake will inch up to 2.08%, Reliance said.

With these investments, Jio Platforms has raised Rs 92,202.15 crore ($12.2 billion) from six investors—Facebook Inc., Silver Lake, Vista Equity Partners, General Atlantic, KKR and Mubadala—in a little more than a month.

Facebook is investing Rs 43,574 crore in Jio Platforms, Vista Equity Rs 11,367 crore and General Atlantic Rs 6,598.38 crore. Silver Lake and co-investors are putting in Rs 10,202.55 crore while KKR is investing Rs 11,367 crore.

The Mubadala investment values Jio Platforms at an equity value of Rs 4.91 trillion and an enterprise value of Rs 5.16 trillion. This is the same as the valuation in the investments made by private equity firms KKR, Silver Lake, Vista Equity and General Atlantic, but 12.5% higher than the level at which social media giant Facebook had put in money.

“We have seen how Jio has already transformed communications and connectivity in India, and as an investor and partner, we are committed to supporting India's digital growth journey,” said Khaldoon Al Mubarak, managing director and group CEO at Mubadala.

Egon Durban, Silver Lake's co-CEO and managing partner, said, “We are excited to increase our exposure and bring more of our co-investors into this opportunity, further supporting Jio Platforms in its mission to bring the power of high-quality and affordable digital services to a mass consumer and small businesses population.”

Reliance, led by billionaire and India’s richest man Mukesh Ambani, had created Jio Platforms late last year to house all its digital businesses. At the time, it had absorbed the $13.5 billion debt of Reliance Jio Infocomm Ltd, its telecommunications arm. The fundraising from the six investors will help Ambani pare the debt.

The six deals show that Reliance isn’t slowing down its dealmaking activities despite the worldwide turmoil caused by the coronavirus pandemic.

Even before these flurry of deals, Reliance had sealed or unveiled a couple of big-ticket transactions with foreign investors. Last year, Reliance had sliced out its telecom infrastructure assets including towers and roped in Canadian investor Brookfield to seal the biggest private equity deal ever in India worth some $3.7 billion.

Also last year, it announced plans to sell a 20% stake in its oil-to-chemicals business to Saudi Aramco for around $15 billion. The company has also raised around $7 billion from a rights issue this month.

Morgan Stanley acted as financial adviser to Reliance Industries. AZB & Partners, and Davis Polk & Wardwell acted as legal counsel. Latham & Watkins LLP, Shardul Amarchand Mangaldas & Co and Simpson Thacher & Bartlett LLP acted as legal counsels to Silver Lake.

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