Posted on

India’s Reliance Jio Platforms to sell $750 million stake to Abu Dhabi Investment Authority

Mukesh Ambani has courted the seventh major investor for his telecommunications business in just as many weeks.

On Sunday, Reliance Jio Platforms said it will sell a stake of 1.16% for $750 million to Abu Dhabi Investment Authority (ADIA), continuing its eye-catching run of investments at the height of a global pandemic.

The three-and-a-half-year-old digital unit of oil-to-retail giant Reliance Industries, the most valuable firm in India, has now secured nearly $13 billion from seven investors including Facebook, and U.S. private equity firms Silver Lake and General Atlantic by selling close to 20% stake.

Today’s announcement from ADIA, one of the world’s largest investors, is the third deal that Reliance Jio Platforms, India’s largest telecom operator with over 388 million subscribers, has secured this week.

Jio Platforms, valued at $65 billion, said earlier this week it was selling $1.2 billion stake to Abu Dhabi-based sovereign firm Mubadala. On Friday, it also announced that U.S private equity firm Silver Lake was pumping an additional $600 million to increase its stake in Jio to 2.1%.

The deal further captures the growing appeal of Jio Platforms to foreign investors looking for a slice of the world’s second-largest internet market. Jio, which launched its commercial operations in the second half of 2016, upended the telecommunications market in India by offering mobile data and voice calls at cut-rate prices.

“The incumbent players (Airtel, Vodafone, Idea, BSNL) in India did the opposite of what companies in their position do elsewhere in the world when a new player emerges in the market. The existing players expect the newcomer to compete aggressively on price. They often lower their prices – some times steeply — to reduce the latter’s attractiveness. Newcomers often complain to the regulators about anti-competitive practices of incumbents,” said Mahesh Uppal, director of communications consultancy firm Com First.

“In India, the opposite happened. It was the existing players who ran to regulators with complaints. So we saw a major miscalculation from incumbent players that had already missed out on taking any major step before the launch of Jio,” he said.

India has emerged as one of the biggest global battlegrounds for Silicon Valley and Chinese firms that are looking to win the nation’s 1.3 billion people, most of whom remain without a smartphone and internet connection.

Media reports have claimed in recent weeks that Amazon is considering buying stakes worth at least $2 billion in Bharti Airtel, India’s third largest telecom operator, while Google has held talks for a similar deal in Vodafone Idea, the second largest telecom operator.

Hamad Shahwan Aldhaheri, who oversees private equity deals at ADIA, said Jio Platforms is poised to benefit from major socio-economic developments and “transformative effects of technology on the way people live and work.”

“The rapid growth of the business, which has established itself as a market leader in just four years, has been built on a strong track record of strategic execution. 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,” he added.

The new capital should help Ambani, India’s richest man, further solidify his commitment to investors when he pledged to cut Reliance’s net debt of about $21 billion to zero by early 2021, said Com First’s Uppal. The firm had no debt in 2012, but things changed when it raced to build Jio.

Moreover, Reliance Industries’ core business — oil refining and petrochemicals — has been hard hit by the coronavirus outbreak. Its net profit in the quarter that ended on March 31 fell by 37%.

“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,” said Ambani.

Read More

Posted on

Reliance Jio Platforms to sell additional $600 million stake to Silver Lake

Silver Lake is doubling down its bet on India’s Reliance Jio Platforms. The U.S. private equity firm said Friday it is buying an additional stake worth $600 million in the top Indian telecom operator, which has now raised $12.2 billion in less than two months at the height of a global pandemic.

The Menlo Park-headquartered firm, which invested nearly $750 million in Reliance Jio Platforms last month, said the additional infusion increases its stake in the Indian firm to 2.08%, up from 1.15%.

Silver Lake’s new investment is now the seventh deal Reliance Jio Platforms, a subsidiary of India’s most valued firm (Reliance Industries), has secured in just as many weeks by selling nearly 20% stake. Earlier on Friday (local time), Abu Dhabi-based sovereign firm Mubadala said it would invest $1.2 billion in Jio, a firm run by Mukesh Ambani, India’s richest man. Facebook, KKR, General Atlantic, and Vista are the other investors that have wrote checks to Jio Platforms.

The announcement further captures the appeal of Jio Platforms, which has amassed over 388 million subscribers in less than four years, to foreign investors that are looking for a slice of the world’s second-largest internet market.

Media reports have claimed in recent weeks that Amazon is considering buying stakes worth at least $2 billion in Bharti Airtel, India’s third-largest telecom operator, while Google has held talks for a similar deal in Vodafone Idea, the second largest telecom operator.

Egon Durban, co-chief executive and managing partner at Silver Lake, said, the recent investment momentum in Reliance Jio Platforms “validates a compelling business model and underscores our admiration for Mukesh Ambani, his team and their courageous vision in creating and building one of the world’s most remarkable technology companies.”

“We are excited to increase our exposure and bring more of our co-investors into this opportunity, further supporting Jio Platforms in its mission to bring the power of high-quality and affordable digital services to a mass consumer and small businesses population,” he added.

Silver Lake manages nearly $40 billion in combined assets and committed capital and has invested in dozens of tech firms over the years including in video game engine maker Unity, audio and video communication service Skype, consultancy firm Gartner, Alibaba’s Ant Financial, computer giant Dell, and Chinese ride-hailing giant Didi Chuxing.

Ambani is raising capital at least in part to cut his oil-to-retail giant Reliance Industries’ net debt of about $21 billion to zero by early 2021, a promise he made to shareholders earlier, said Mahesh Uppal, director of communications consultancy firm Com First. The company was debt free in 2012, but took loans to bankroll the creation of Jio Platforms.

“I would like to emphasise that Silver Lake’s additional investment in Jio Platforms, within a span of five weeks during the COVID-19 pandemic, is a strong endorsement of the intrinsic resilience of the Indian economy, which will surely grow bigger with comprehensive digital enablement,” said Ambani in a statement.

Read More

Posted on

India’s Reliance Jio Platforms to sell $1.2 billion stake to Mubadala

Abu Dhabi-based sovereign firm Mubadala has become the latest investor in Mukesh Ambani’s Reliance Jio Platforms, joining five American firms including Facebook and Silver Lake that have secured stakes in India’s biggest telecom operator at the height of a once-in-a-century global pandemic.

Mubadala said it had agreed to invest $1.2 billion in Reliance Jio Platforms for a 1.85% stake in the firm. The deal valued the Indian telecom operator, which launched in the second half of 2016, at $65 billion.

A subsidiary of Reliance Industries, the most valued firm in India whose core businesses are in oil refining and petrochemicals, Reliance Jio Platforms has raised $11.5 billion by selling 19% stake in the last seven weeks.

“Through my longstanding ties with Abu Dhabi, I have personally seen the impact of Mubadala’s work in diversifying and globally connecting the UAE’s knowledge-based economy. We look forward to benefitting from Mubadala’s experience and insights from supporting growth journeys across the world,” Mukesh Ambani, the chairman and managing director of Reliance Industries, said in a statement.

The announcement today further shows the appeal of Jio Platforms to foreign investors that are looking for a slice of the world’s second-largest internet market. Media reports have claimed in recent weeks that Amazon is considering buying stakes worth at least $2 billion in Bharti Airtel, India’s third-largest telecom operator, while Google has held talks for a similar deal in Vodafone Idea, the second largest telecom operator.

India has emerged as one of the biggest global battlegrounds for Silicon Valley and Chinese firms that are looking to win the nation’s 1.3 billion people, most of whom remain without a smartphone and internet connection.

Khaldoon Al Mubarak, managing director and group chief executive of Mubadala Investment Company, said, “We have seen how Jio has already transformed communications and connectivity in India, and as an investor and partner, we are committed to supporting India’s digital growth journey. With Jio’s network of investors and partners, we believe that the platform company will further the development of the digital economy.”

Mubadala, which has more than $229 billion in assets, is also an investor in AMD and Alphabet’s Waymo, and SoftBank.

The new capital should help Ambani, India’s richest man, further solidify his commitment to investors when he pledged to cut Reliance’s net debt of about $21 billion to zero by early 2021 — in part because of the investments it has made to build Jio Platforms, said Mahesh Uppal, director of Com First, a communications consultancy.

Its core business — oil refining and petrochemicals — has been hard hit by the coronavirus outbreak. Its net profit in the quarter that ended on March 31 fell by 37%.

Read More

Posted on

JioMart, the e-commerce venture from India’s richest man, launches in additional cities

The rationale behind the deluge of dollars flooding into billionaire Mukesh Ambani’s Reliance Jio Platforms is beginning to become more clear as his e-commerce venture JioMart starts rolling out to more people across India.

An e-commerce venture between the nation’s top telecom operator Jio Platforms and top retail chain Jio Retail, JioMart just launched its new website and started accepting orders in dozens of metro, tier 1 and tier 2 cities including Delhi, Chennai, Kolkata, Bangalore, Pune, Bokaro, Bathinda, Ahmedabad, Gurgaon, and Dehradun.

Before the expansion on Saturday, the service was available in three suburbs of Mumbai. The service now includes perishables such as fruits and vegetables, and dairy items in addition to staples and other grocery products as it makes its pitch to Indian households across the country.

Ambani’s Reliance Jio Platforms, which has raised more than $10 billion in the last month by selling a roughly 17% stake, has amassed over 388 million subscribers, more than any other telecom operator in the country.

The money comes as Ambani’s various companies begin entering a market already teeming with fierce competitors like Amazon, Walmart’s Flipkart, BigBasket, MilkBasket, and Grofers.

Earlier this week the American e-commerce giant entered India’s food delivery market to challenge the duopoly of Prosus Ventures-backed Swiggy and Ant Financial-backed Zomato. Amazon is making a massive hiring push in India, and is looking to hire close to 50,000 seasonal workers to keep up with the growing demand on its platform.

Meanwhile, Ambani’s Reliance Retail, founded in 2006, remains the largest retailer in India by revenue. It serves more than 3.5 million customers each week through its nearly 10,000 physical stores in more than 6,500 cities and towns.

JioMart may have Amazon and Flipkart in its sights, but in its current form, however, the company is going to be more of a headache for Grofers and BigBasket, the top grocery delivery startups in India.

Reliance Industries, the most valued firm in India and parent entity of Jio Platforms and Reliance Retail, plans to expand JioMart to more than a thousand districts in a year and also widen its catalog to include electronics and office supplies among a variety of other categories, a person familiar with the matter told TechCrunch. A Reliance Jio spokesperson declined to comment.

The expansion to more cities comes a month after JioMart launched its WhatsApp business account, enabling people to easily track their order and invoice on Facebook -owned service.

Facebook announced it would invest $5.7 billion in India’s Reliance Jio Platforms last month and pledged to work with the Indian firm to help small businesses across the country. JioMart’s WhatsApp account currently does not support the expanded regions.

Mukesh Ambani, India’s richest man and the chairman and managing director of Reliance Industries, first unveiled his plan to launch an e-commerce platform last year. In a speech then, Ambani invoked Mahatma Gandhi’s work and said India needed to fight another fresh battle.

A handful of firms have attempted — and failed — to launch their e-commerce websites over the years in India, where more than 95% of sales still occur through brick and mortar stores. But Ambani is uniquely positioned to fight the duopoly of Amazon and Walmart’s Flipkart — thanks in part to the more than $10 billion in investment dollars the company recently raised from KKR, FacebookSilver LakeVista Equity Partners, and General Atlantic. In addition to scaling JioMart, the fresh capital should also help Ambani repay some of Reliance Industries’ $21 billion debt.

“We have to collectively launch a new movement against data colonization. For India to succeed in this data-driven revolution, we will have to migrate the control and ownership of Indian data back to India — in other words, Indian wealth back to every Indian,” Ambani said at an event attended by Indian Prime Minister Narendra Modi .

Read More

Posted on

KKR to invest $1.5 billion in India’s Reliance Jio Platforms

Mukesh Ambani’s Reliance Jio Platforms has agreed to sell 2.32% stake to U.S. equity firm KKR in what is the fifth major deal the top Indian telecom operator has secured in just as many weeks.

On Friday, KKR announced it will invest $1.5 billion in the top Indian telecom operator, a subsidiary of India’s most valued firm (Reliance Industries), joining fellow American investors Facebook, Silver Lake, Vista Equity Partners, and General Atlantic that have made similar bets on Jio Platforms.

The investment from KKR, which has written checks to about 20 tech companies including ByteDance and GoJek in the past four decades, values Reliance Jio Platforms at $65 billion.

The announcement today further shows the appeal of Jio Platforms, which has raised $10.35 billion in the past month by selling about 17% of its stake, to foreign investors that are looking for a slice of the world’s second-largest internet market.

Ambani, the chairman and managing director of oil-to-telecoms giant Reliance Industries that has poured over $30 billion to build Jio Platforms, said the company was looking forward to leverage “KKR’s global platform, industry knowledge and operational expertise to further grow Jio.”

In recent years, India has emerged as one of the biggest global battlegrounds for Silicon Valley and Chinese firms that are looking to win the nation’s 1.3 billion people, most of whom remain without a smartphone and internet connection.

Amazon, Google, Facebook, Microsoft, Xiaomi, and TikTok-parent firm ByteDance among several others already count India as one of their most important overseas markets. In the past decade, nearly half a billion Indians came online for the first time, thanks in large part to Reliance Jio, which has amassed over 388 million subscribers.

An advertisement featuring Bollywood actor Shah Rukh Khan for Reliance Jio (Image: Dhiraj Singh/Bloomberg via Getty Images)

Launched in the second half of 2016, Reliance Jio upended India’s telecommunications industry with cut-rate data plans and free voice calls, forcing incumbents such as Airtel and Vodafone to significantly revise their prices to sustain customers and many to consolidate and exit the market.

Jio Platforms, a subsidiary of Reliance Industries, operates the telecom venture, called Jio Infocomm, that has become the top telecom operator in India.

Reliance Jio Platforms also owns a bevy of digital apps and services including music streaming service JioSaavn (which it says it will take public), on-demand live television service and payments service, as well as smartphones, and broadband business.

“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,” Henry Kravis, co-founder and co-chief executive of KKR, said in a statement.

“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,” he added. This is the single-largest investment (in equity terms) made from KKR’s Asia private equity business to date.

The new capital should also help Ambani, India’s richest man, further solidify his last year’s commitment to investors when he pledged to cut Reliance’s net debt of about $21 billion to zero by early 2021 — in part because of the investments it has made to build Jio Platforms. Its core business — oil refining and petrochemicals — has been hard hit by the coronavirus outbreak. Its net profit in the quarter that ended on March 31 fell by 37%.

In the company’s earnings call last month, Ambani said several firms had expressed interest in buying stakes in Jio Platforms in the wake of the deal with Facebook. Recent investments also pave the way for an initial public offering of Jio, which could happen within five years.

Read More

Posted on

General Atlantic to invest $870M in India’s Reliance Jio Platforms

Mukesh Ambani’s Jio Platforms has agreed to sell its 1.34% stake to General Atlantic, the latest in a series of deals the top Indian telecom operator has secured in recent weeks.

On Sunday, New York-headquartered private equity firm General Atlantic said it would invest $870 million in the Indian telecom operator, a subsidiary of India’s most valued firm (Reliance Industries), joining fellow American investors Facebook, Silver Lake, and Vista Equity Partners that have also made sizeable bets on the three-and-a-half-year old Indian firm.

General Atlantic’s investment values Jio Platforms at $65 billion — the same valuation implied by the Silver Lake and Vista deals and a 12.5% premium over Facebook’s deal, the Indian firm said.

Sunday’s announcement further illustrates the growing appeal of Jio Platforms, which has raised $8.85 billion in the past one month by selling about 14.7% of its stake, to foreign investors that are looking for a slice of the fast-growing world’s second largest internet market.

General Atlantic, a high profile investor in consumer tech space that has invested in dozens of firms such as Airbnb, Alibaba, Ant Financial, Box, ByteDance, Facebook, Slack, Snapchat, and Uber, has been a key investor in India for more than a decade though it has avoided bets in consumer tech space in the country.

It has cut checks to several Indian startups including NoBroker, a Bangalore-based startup that helps those looking to rent or buy an apartment connect directly with property owners, edtech giants Unacademy and Byju’s, payments processor BillDesk, and National Stock Exchange of India. The PE firm, which has invested about $3 billion in India, said last week that it was looking to invest an additional $1.5 billion in Indian firms by next year — this time focusing on the players operating in consumer tech category.

Reliance Industries chairman Ambani, who has poured more than $30 billion to build Jio Platforms, said the telecom network would “leverage General Atlantic’s proven global expertise and strategic insights across 40 years of technology investing.”

“General Atlantic shares our vision of a digital society for India and strongly believes in the transformative power of digitization in enriching the lives of 1.3 billion Indians,” he added.

Prepaid SIM cards of Reliance Jio at a retail store. (Photo: INDRANIL MUKHERJEE/AFP via Getty Images)

Launched in the second half of 2016, Reliance Jio upended India’s telecommunications industry with cut-rate data plans and free voice calls. Jio Platforms, a subsidiary of Reliance Industries, operates the telecom venture, called Jio Infocomm, that has amassed 388 million subscribers since its launch to become the nation’s top telecom operator.

Reliance Jio Platforms also owns a suite of services including music streaming service JioSaavn (which it says it will take public), smartphones, broadband business, on-demand live television service and payments service.

“In just three and a half years, Jio has had a transformational impact in democratizing data and digital services, propelling India to be positioned as a leading global digital economy,” said Sandeep Naik, MD and Head of India & Southeast Asia at General Atlantic, in a statement.

The new capital would help Ambani, India’s richest man, further solidify his last year’s commitment to investors when he said he aimed to cut Reliance’s net debt of about $21 billion to zero by early 2021. Its core business — oil refining and petrochemicals — has been hard hit amid the coronavirus outbreak. Its net profit in the quarter that ended on March 31 fell by 37%.

In the company’s earnings call last month, Ambani said several firms had expressed interest in buying stakes in Jio Platforms in the wake of the deal with Facebook . Bloomberg reported last week that Saudi Wealth Fund was also in talks with Ambani for a stake in Jio Platforms.

Facebook said that other than offering capital to Jio Platforms for a 9.99% stake in the firm, it would work with the Indian giant on a number of areas starting with e-commerce. Days later, JioMart, an e-commerce venture run by India’s most valued firm, began testing an “ordering system” on WhatsApp, the most popular smartphone app in India with over 400 million active users in the country.

29-year-old Akash Ambani, the oldest son of Mukesh, said in a statement, “Jio is committed to make a digitally inclusive India that will provide immense opportunities to every Indian citizen especially to our highly talented youth.”

Read More