Silver Lake to invest $746.8 million in Jio Platforms
04 May 2020
Reliance Industries Ltd and Jio Platforms Ltd announced today that Silver Lake will invest Rs5,655.75 crore (about $746.8 million) into Jio Platforms. This investment assigns Jio Platforms an equity value of Rs4.90 lakh crore and an enterprise value of Rs5.15 lakh crore.
The sale of stake to Silver Lake is at a 12.5 per cent premium to the equity valuation of the Facebook investment announced on 22 April 2020.
Silver Lake’s investment follows a larger investment by Facebook to acquire9.9 per cent stake in Jio Platforms allowing the two to would jointly on a number of areas starting with e-commerce.
In the company’s earnings call last week, Ambani said several firms had expressed interest in buying a stake in Jio Platforms, in which he has invested over $30 billion, in wake of the deal with Facebook.
Jio Platforms, a wholly-owned subsidiary of Reliance Industries Limited, is a next-generation technology company building a digital society by bringing together Jio’s leading digital apps, digital ecosystems and India’s No1 high speed connectivity platform under one umbrella.
Reliance Jio Infocomm Ltd, which provides connectivity platform to over 388 million subscribers, will continue to be a wholly owned subsidiary of Jio Platforms.
Jio’s vision is to digitally connect people and businesses throughout India, especially small merchants, micro-businesses and farmers with its digital services and emerge as a global technology leader.
Comprehensive digitisation will be a vital component of the revitalisation of the Indian economy, RIL stated, adding, “It is our strong conviction that no one should be deprived of the tremendous new opportunities, including those for new employment and new businesses, embedded in India’s 360-degree digital transformation.”
“With approximately $40 billion in combined assets under management and committed capital and a singular focus on the world’s great tech and tech-enabled opportunities, Silver Lake is the global leader in large-scale technology investing. Its mission is to build and grow great companies by partnering with world-class management teams. Its investments have included Airbnb, Alibaba, Ant Financial, Alphabet’s Verily and Waymo units, Dell Technologies, Twitter and numerous other global technology leaders, an RIL release stated.
“This investment by Silver Lake is further testament to the world-class digital platform that Jio has built, powered by leading technologies, such as Broadband connectivity, Smart Devices, Cloud and Edge Computing, Big Data Analytics, Artificial Intelligence, Internet of Things, Augmented and Mixed Reality and Blockchain,” it added.
“I am delighted to welcome Silver Lake as a valued partner in continuing to grow and transform the Indian digital ecosystem for the benefit of all Indians. Silver Lake has an outstanding record of being a valuable partner for leading technology companies globally. Silver Lake is one of the most respected voices in technology and finance. We are excited to leverage insights from their global technology relationships for the Indian Digital Society’s transformation,” Mukesh Ambani, chairman and managing director of Reliance Industries Ltd, said.
“Jio Platforms is one of the world’s most remarkable companies, led by an incredibly strong and entrepreneurial management team who are driving and actualising a courageous vision. They have brought extraordinary engineering capabilities to bear on bringing the power of low-cost digital services to a mass consumer and small businesses population. 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 team at Reliance and Jio to help further the Jio mission,” Egon Durban, Silver Lake Co-CEO and managing partner, said.
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 counsels.