Jio Platforms on a Selling Spree to Whittle Down Debt

CIOReviewIndia Team | Friday, 22 May 2020, 17:28 IST


KKR & Co Inc plans to invest over 11000 crores in Reliance Industries’ Jio Platforms, which is going to be fifth successive investment in RIL on the heels of investments it attracted from social media giant Facebook, private equity funds Silver Lake, Vista Equity Partners and General Atlantic. Analysts believe that more such deals may be in order. If finalized, this investment will hitherto be the biggest investment in Asia, making the total amount of new funds raised by Jio this month to a massive $10 billion. So, combining all its recent stakes sold, Jio Platforms has now let go of a total stake of over 17 percent in five fundraising deals led by Facebook Inc which spent $5.7 billion to grab 9.99 percent stake in the RIL arm. KKR’s purchase of the 2.32 percent stake has made Jio Platforms India’s second most valuable standalone tech firm second only to IT services behemoth Tata Consultancy Services.

Jio Platforms having proven its potential to become a dominant player in India’s digital economy has already overtaken several rivals with cut-throat pricing, and is counting on Reliance’s retail network to expand e-commerce. The RIL unit consists mostly of its telecom business under Reliance Jio Infocomm, which is the largest in the country with more than 380 million subscribers. RIL’s other digital properties and investments such as Jio Cinema, Jio Saavn and Haaptik are a part of Jio Platforms. The company is also invested in connected cars, security systems and smart homes.

“We are investing behind Jio Platforms’ impressive momentum, world-class innovation and strong leadership team,” said Henry Kravis, Co-founder and Co-CEO of the U.S. buyout firm. The new funds raised will help Reliance meet its target of eliminating $21.4 billion in net debt this year. The company headed by Mukesh Ambani, is also selling $7 billion in new shares. Believing in the mantra of data being the new oil, Mukesh Ambani has been striving to diversify his empire and expand its reach beyond energy and petrochemicals, starting with the establishment of Jio Infocomm in 2016.  

KKR has also invested in other tech companies like ByteDance and digital payments firm GoJek.

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