RIL closes deal with KKR

Reliance Industries Limited announced that KKR will invest Rs 11,367 crore in Jio Platforms for a 2.32 percent stake.

“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 percent equity stake in Jio Platforms on a fully diluted basis,” RIL said in a press release.

“KKR shares our ambitious goal of building a premier Digital Society in India. KKR 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,” said Mukesh Ambani, Chairman and Managing Director in a statement.

The transaction is subject to regulatory and other customary approvals

With the latest deal, Jio Platforms will get a combined Rs 78,562 crore from five investments. General Atlantic on May 18 said it will buy 1.34 percent stake in Jio Platforms for Rs 6,598.38 crore, while Vista Equity Partners said on May 8 it will be picking up a 2.32 percent stake for Rs 11,367 crore. Prior to that, Silver Lake said it will invest Rs 5,655.75 crore in Jio Platforms for a 1.15 percent stake and on April 22, Facebook said it would invest USD 5.7 billion for a 9.99 percent stake.

RIL opened its Rs 53,215 crore rights issue for subscription on Monday in an effort to achieve debt-free status in close to a year. The total capital raised by RIL after its last four deals amounted to Rs 1,20,320 crore. The company had total debt of Rs 1,61,035 crore at the end of FY 20. As part of the proposed rights issue, RIL shareholders were offered a new share for every 15 held at Rs 1,257 a share. This is the first rights issue by RIL in three decades. The issue was structured as partly paid shares and enabled shareholders to phase out the outlay on their investment over a period of time.

“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.” said Henry Kravis, Co-Founder and Co-CEO of KKR, in a statement.

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 today the firm’s technology portfolio has more than 20 companies across the Technology, Media and Telecom sectors.

Reliance is engaged in several parallel dialogues — including with sovereign fund PIF and sovereign wealth fund of UAE Mubadala — that are at various stages.

—CT Bureau