KKR to invest $1.5 billion in Reliance Industries' digital unit

Yolanda Curtis
May 23, 2020

India's Reliance Industries said KKR will invest US$1.50 billion in Jio Platforms, marking the fifth fundraising deal in a month by its digital unit and bringing the total amount of new investment to US$10 billion.

"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", the investment firm's Co-Founder and Co-CEO Henry Kravis said in a statement.

"We are investing behind Jio Platforms' impressive momentum, world-class innovation and strong leadership team", Henry Kravis, co-founder and co-chief executive of the U.S. buyout firm, said in a statement on Friday.

This transaction values Jio Platforms at an equity value of INR 4.91 Lakh Cr and an enterprise value of INR 5.16 Lakh Cr.

Commenting on the deal, Mukesh Ambani, chairman and managing director of RIL, said, "We are looking forward to leveraging KKR's global platform, industry knowledge, and operational expertise to further grow Jio". Combined, Jio platforms have received ₹78,562 crore investments from these companies.

Disclosure: Network18, the parent company of CNBCTV18.com, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

KKR has invested more than US$30 billion in tech companies, including China's ByteDance and Indonesian digital payments firm GoJek.

The other three private equity investors - General Atlantic, Vista and Silver Lake - too had assigned the same valuation to the Mumbai-based company. KKR has a proven track record of being a valuable partner to industry-leading franchises and has been committed to India for many years. The money invested by KKR will help the company achieve what it calls a Digital India vision for 1.3 billion people and businesses across the country, including small businesses, micro-businesses and farmers. The private equity fund will pay 113.7 billion rupees for a 2.3% stake in Jio.

The transaction is subject to regulatory and other customary approvals.

The billionaire's success in drawing big, seasoned tech investors like Facebook and General Atlantic to Jio comes despite a sharp drop in economic growth caused by the pandemic and uncertainty about how much damage will be done before the deadly pathogen is under control.

Often saying "data is the new oil", Mr Ambani has sought to diversify his empire away from energy and petrochemicals, beginning in 2016 with the establishment of Jio Infocomm which is now India's biggest telecom carrier with more than 376 million subscribers. Deloitte Touche Tohmatsu India LLP acted as financial advisor to KKR.

The Indian Express is now on Telegram.

Other reports by iNewsToday