Reliance Jio is not just a telecom network, it is an entire ecosystem that allows Indians to live the digital life to the fullest. It was founded by Mr. Mukesh Ambani who has been working on the JIO Infocomm Ltd since 2010. The idea is said to have come into existence when his daughter Isha Ambani complained of Low data speed (She is to thank for the fast downloads we are availing using JIO now).
Jio Platforms is a next-generation technology platform focused on providing high-quality and affordable digital services across India. Jio Platforms has made significant investments across its digital ecosystem which is powered by leading technologies like broadband connectivity, smart devices, cloud and edge computing, big data analytics, artificial intelligence, Internet of Things(IoT), augmented and mixed reality, and blockchain.
Jio’s vision is to enable a Digital India for 1.3 billion people and businesses across the country, including small merchants, micro-businesses, and farmers so that all of them can enjoy the inclusive growth together. With these investments, Ambani plans to drive Jio ahead in the competition with giants like Amazon.com Inc. and Walmart Inc., both of which have investments in. Since 22nd April, 2020 Reliance Jio has got its 10th investment and has raised 104,326.95 crore in just seven weeks from leading global investors including Facebook, Silver Lake ( Twice), Vista Equity Partner, General Atlantic, KKR. & Co.Inc., Mubadala Investment Company, Abu Dhabi Investment Authority, TPG Capital, L Catterton, and Saudi Arabia PIF.
Reliance Jio results for the financial year ending March 31, 2020 (USD ($), millions)
On the 5th of June, Reliance Jio, the telecom unit of Reliance Industries, announced that US-based private growth equity firm Silver Lake has once again struck a deal of Rs 4,546.8 crore taking around 2.08% of stake making 7 deals in 6 weeks. While Mubadala, an Abu Dhabi based investment company also invested around Rs 9,093.6 crore on June 4. With these investments, Jio has raised Rs 92,202.15 crore ($8 billion) selling around 19.8% of their stake from leading technology investors like Facebook, Silver Lake, Vista Equity Partners, General Atlantic, and Mubadala in just 6 weeks. This was the seventh investment on Reliance Jio platforms since Facebook’s investment on April 22. India, and are the world’s biggest open consumer market.
Companies that have Invested in Reliance Jio
Here is the list of Reliance Jio Investors in a nutshell
|Name of the Company||Stake||Total Investment|
|Vista Equity Partner||2.32%||11,367 Crores|
|Silver lake partner||1.15%||5,655.75 Crores|
|General Atlantic||1.34%||6,598.38 Crores|
|KKR. & Co.Inc.||2.32%||11,367 Crores|
|Mubadala Investment Company||1.85%||9,093.60 Crores|
|Silver lake partner||0.93%||4,546.80 Crores|
|Abu Dhabi Investment Authority||1.16%||5,683.5 Crores|
|TPG Capital||0.93%||4,546.80 Crores|
|L Catterton||0.39%||1,894.50 Crore|
|Saudi Arabia's wealth fund PIF||2.32%||11,367 crore|
The social media giant Facebook had announced on April 22 its plans to invest $5.7 billion which is Indian Rs 43,574 crore for 9.99% stake in Reliance Industries Limited’s(RIL) telecom business, Reliance Jio. By partnering with Jio, Facebook plans to take advantage of its popular WhatsApp messenger to offer digital payment services to small grocers in India.
With a 9.9 percent stake in Reliance Jio, Facebook gets a firm foothold in a fast-growing market in India. Also, it helps Reliance Jio to significantly cut down its debts. The deal valued Jio at Rs 4.62 lakh crore ($65.95 billion). It was Facebook’s biggest deal since the $22 billion buyouts of WhatsApp in 2014.
Three days later, Reliance Retail signed a commercial agreement with Facebook's WhatsApp to further the reach of its online venture JioMart as it went live on WhatsApp on April 26. JioMart began offering its services in sub-urban Mumbai areas like Navi Mumbai, Thane, and Kalyan. These services will be extended all over the country.
This deal is expected to show the capacity for scaling due to a heavy user base comprising 400 million WhatsApp users and Jio’s 388 million subscribers. JioMart uses WhatsApp to bring in high-speed information and digital cash. JioMart and Whatsapp will empower nearly 3 crores small Indian Kirana shops to digitally transact and take on giants such as Amazon India.
Silver Lake Partners-Jio Deal
Jio-Silver Lake deal came less than two weeks after the Facebook deal. On the 4th of May, Silver Lake Partners, an American private equity giant, bought a 1% stake in Jio Platforms for Rs 5,655.75 crore($750 million). This deal took Jio's enterprise value to Rs 5.15 lakh crore and represents a 12.5% premium to the equity valuation of Facebook's investment and again hitting the investing road with Jio, they invested around Rs 4,546.8 crore taking around 2.08% of the company stake. Now the aggregate investment by this firm is around Rs 10,202.55 crore.
Reliance Industries Limited’s Chairman, Mukesh Ambani said during the first investment,
"Silver Lake Partners has an outstanding record of being a valuable partner for leading technology companies globally. We are excited to leverage insights from their global technology relationships for the Indian digital society's transformation."
These deals will help Reliance use Facebook's tech in its new businesses. It will give the US tech giant's Indian reach a massive boost through a partner in Ambani who is widely perceived to be influential in government circles. Silver Lake's investment highlights Reliance's ability to monetize its digital services business and strengthens Reliance’s already strong financial flexibility.
Silver Lake Partners (SLP) was launched in 1999 as a specialist firm to focus on technology company investments. SLP made headlines after acquiring PC maker Dell Inc in conjunction with Michael Dell in 2013. Its portfolio of investments collectively generates revenues of more than $204 billion annually. Its portfolio includes Twitter, Airbnb, Alibaba Group, Ant Financial, Didi Chuxing, Motorola Solutions, and City Football Group.
Vista Equity Partners-Jio Deal
On the 8th of May, Vista Equity Partners, a US-based private equity firm running the world’s largest exclusively tech-focused fund, bought a 2.32 % stake in Jio Platforms for Rs. 11,367 crore. The deal made it the third high-profile investment in the Reliance Industries Ltd' (RIL) unit and highlights Jio's status as a next-generation software and platform company.
This deal valued Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore. Vista’s investment is at a 12.5% premium over the deal with Facebook. It will be Vista’s biggest investment outside of its home country and it’s first in Asia. With this deal, Jio has become the fourth most valued entity in India after HDFC Bank, TCS, and RIL.
RIL chairman Mukesh Ambani stated,
“In Robert and Brian, whose family hails from Gujarat, I found two outstanding global technology leaders who believe in India and the transformative potential of a digital Indian society. We are excited to leverage the professional expertise and multi-level support that Vista has been offering to its investments globally for the benefit of Jio.”
The investment from Vista will be used by Jio to buy back RIL’s optionally convertible preference shares. The Vista deal will further help in fixing the equity value of Jio and improve RIL’s cash flows. This will accelerate RIL’s deleveraging exercise as RIL plans to eliminate Rs 1.75 lakh crore of net debt by the end of this financial year. Through Jio, Vista hopes to earn good returns as and when the telecom and technology company goes public, which is part of Ambani’s plan.
Vista chairman Robert Smith, a.k.a the richest black American, said,
“Mukesh’s vision as a global pioneer, alongside Jio’s world-class leadership team, has built a platform to scale and advance the data revolution it started. We are thrilled to join Jio Platforms to deliver exponential growth in connectivity across India, providing modern consumer, small business, and enterprise software to fuel the future of one of the world’s fastest-growing digital economies.”
General Atlantic-Jio Deal
Billionaire Mukesh Ambani extended his fund-raising streak for Jio Platforms Ltd. by selling a 1.34% equity stake to General Atlantic on May 17. Reliance Industries Limited and Jio Platforms Limited announced an investment of ₹ 6,598.38 crores ($873 Mn) stake by General Atlantic, a leading global growth equity firm that has invested in Airbnb Inc. and Uber Technologies Inc.
This investment values Jio Platforms at an equity value of ₹ 4.91 lakh crore and an enterprise value of ₹ 5.16 lakh crore. The deal will consolidate backing for Jio’s plan to use its almost 400 million mobile phone subscribers as a base for an e-commerce drive to use India’s vast consumer markets—from retail to education and payments. The deal will also support Ambani’s vow to pay down more than $20 billion of net debt at Reliance earlier than an initial March 2021 deadline.
Akash Ambani, director of Reliance Jio and Mukesh Ambani’s son, stated,
“We are delighted that a renowned global investor like General Atlantic is partnering with us in our journey to digitally empower India and Indians. Jio is committed to making a digitally inclusive India that will provide immense opportunities to every Indian citizen.”
General Atlantic is a leading global growth equity firm with a 40-year track record of investing in the Technology, Consumer, Financial Services, and Healthcare sectors. It operates across 14 locations as an integrated team under a global investment platform. To date, General Atlantic has invested in prominent entrepreneurs and companies around the world such as Airbnb, Alibaba, Ant Financial, Box, ByteDance, Facebook, Slack, Snapchat, Uber, and other global technology leaders.
KKR & Co. Inc.-Jio Deal
KKR is an American private equity firm and has also been one of the key investors by buying around Rs 11367 crores around 2.32% of the stake.
Reliance Industries Limited chairman Mukesh Ambani stated, “We are looking forward to leveraging KKR’s global platform, industry knowledge, and operational expertise to further grow Jio.”
Whereas KKR chairman Henry Kravis said “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,”
KKR was founded in 1976 by Henry Kravis and George Roberts and since then has been a prime equity firm of the US market.
Mubadala Investment Company-Jio Deal
Striking a deal of Rs 9093.6 crore with the Abu Dhabi based investment company will surely help Reliance Jio to expand its reach towards the gulf countries. It will help them expand their venture globally. While so many US-based firms investing and now Abu Dhabi based firms also becoming an important investor.
Mubadala Investment Company founded in 2017 in Abu Dhabi, UAE has been one of the key investing company which has helped in growing up UAE economy at a global front. Investments like these can play a key role in developing Jio hold all around the world.
Abu Dhabi Investment Authority (ADIA)-Jio Deal
Abu Dhabi Investment Authority (ADIA), one of the world’s biggest sovereign wealth funds, will pump Rs 5,683.5 crore into Jio Platforms joining the list of global tech investors that have invested millions of dollars on the Reliance Industries unit due to its unique potential to dominate India’s booming digital economy.
The decision by ADIA, a globally-diversified investment institution, in exchange for a 1.16 percent stake, is an unprecedented eighth investment in Jio Platforms in less than seven weeks and marks the largest continuous fundraising action by a company anywhere in the world. RIL, the oil-to-retail-to-telecom conglomerate, has now sold a little over 21 percent stake in Jio Platforms through a flurry of fundraising deals and raised as much as Rs 97,885.65 crore, or $12.96 billion.
Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said,
“I am delighted that ADIA, with its track record of more than four decades of successful long-term value investing across the world, is partnering with Jio Platforms in its mission to take India to digital leadership and generate inclusive growth opportunities. This investment is a strong endorsement of our strategy and India’s potential.”
Hamad Shahwan Aldhaheri, Executive Director of the Private Equities Department at ADIA, said,
“Our investment in Jio is a further demonstration of ADIA’s ability to draw on deep regional and sector expertise to invest globally in market-leading companies and alongside proven partners.”
TPG Captial is going to invest 4,546.80 Crores for a 0.93% stake in Jio platform, making it the ninth deal in just a span of seven weeks taking the combined fundraising in the Reliance Industries unit cross the 1 lakh crore mark. TPG has previously invested in Companies like Airbnb, Uber and Spotify.
Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said on the deal,
“Today, I am happy to welcome TPG as valued investors in our continued efforts towards digitally empowering the lives of Indians through the creation of a digital ecosystem. 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.”
In TPG's more than 25 years of history, it has successfully built an ecosystem made up of hundreds of portfolio companies and a value added network of professionals, executives and advisors around the world. By offering institutional support and global resources, TPG enables these companies to reach their full potential and unlock greater possibilities.
Jim Coulter, Co-CEO TPG, said,
“We are excited to partner Reliance to invest in Jio. 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. Jio is a disruptive industry leader that is empowering small businesses and consumers across India by providing them with critical, high-quality digital services. The company is bringing unmatched potential and execution capabilities to the market, setting the tone for all technology companies to come.”
L Catterton-Jio Deal
World's largest consumer focused private equity firm L Catterton is going to invest Rs 1,894.50 crore in Jio Platforms for a 0.39 percent stake in Reliance Jio. With this Reliance Jio has made a historic record with 10 investments in just seven weeks and has raised 104,326.95 crore from leading global investors since April 22nd , 2020.
Mukesh Ambani said,
“I am delighted to welcome L Catterton as a partner in our journey to unleash the power of digital for India while providing a consumer experience that is among the best in the world. I particularly look forward to gaining from L Catterton’s invaluable experience in creating consumer-centric businesses because technology and consumer experience need to work together to propel India to achieving digital leadership.”
L Catterton is a preferred investment partner for several leading consumer-focused brands around the world. Having a 30-year track record of leveraging its operational expertise, deep sector insights, global network of resources, and its unique partnership with LVMH and Groupe Arnault, L Catterton has successfully invested in and helped build some of the most innovative brands at the forefront of the evolving consumer landscape, including Peloton, Vroom, ClassPass, Owndays, FabIndia, and more.
Michael Chu, Global Co-CEO of L Catterton, said,
“Over our more than 30 year history, we have established a track record of building many of the most important brands across all consumer categories and geographies, from retailers, omni-channel and digitally native brands. We are strong supporters of fostering growth through product development, enhanced digital capabilities, and strategic alliances. We look forward to partnering with Jio, which is uniquely positioned to execute on its vision and mission to transform the country and build a digital society for 1.3 billion Indians through its unmatched digital and technological capabilities"
Saudi Arabia’s PIF-Jio Deal
Saudi Arabia’s wealth fund Public Investment Fund (PIF), one of the world's largest sovereign wealth funds is all set to pick up a 2.32 per cent stake in Indian oil-to-telecom conglomerate Reliance Industries’ Jio, for an estimated $1.5 billion. With PIF coming on board, Jio Platforms has diluted 25 per cent of its equity. That’s the maximum they intend to dilute to financial investors, which includes Mark Zukerberg’s Facebook. Any new investors coming on board in future will have to be “strategic investors, a tech giant, for instance,” said a source who was part of the deal-making process.
The secret behind Jio’s success is that it’s customer-centric and has a webscale mentality. Reliance Jio made it look easy when it successfully swooped into the jam-packed and super competitive mobile market with free 4G voice and data service. So in short Reliance Jio aims at harnessing the full potential of the internet to create a digital revolution through their technologies. Innovative services and long-term planning will radically bring the world at one’s fingertips much faster and also transform the way Indians think, work, live, and are entertained.