TPG picks 0.93 pc stake in Jio Platforms for Rs 4,546.80 crore
Reliance Industries on Saturday said it has sold 0.93 per cent stake in its digital unit to global alternative asset firm TPG for Rs 4,546.80 crore, taking the cumulative fund raising to over Rs 1.02 lakh crore that will help pare debt at the oil-to-telecom conglomerate.
“TPG will invest Rs 4,546.80 crore in Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore,” the company said in a statement.
The investment will translate into a 0.93 per cent equity stake in Jio Platforms on a fully diluted basis for TPG.
“With this investment, Jio Platforms has raised Rs 102,432.45 crore from leading global technology investors including Facebook, Silver Lake, Vista Equity Partners, General Atlantic, KKR, Mubadala, ADIA, and TPG since April 22, 2020,” it said.
The deal book was opened with Facebook picking up a 9.99 per cent stake in the firm that houses India’s youngest but largest telecom firm on April 22 for Rs 43,574 crore.
Within days of that deal, Silver Lake - the world’s largest tech investor - bought a 1.15 per cent stake in Jio Platforms for Rs 5,665.75 crore on May 4. On May 8, US-based Vista Equity Partners bought 2.32 per cent stake in Jio Platforms for Rs 11,367 crore.
Global equity firm General Atlantic on May 17 picked up 1.34 per cent stake in Jio Platforms for Rs 6,598.38 crore. This was followed by US private equity giant KKR buying 2.32 per cent for Rs 11,367 crore.
Abu Dhabi soverign wealth fund Mubadala Investment picked up 1.85 per cent in Jio Platforms for Rs 9,093.60 crore on June 5. On that day, private equity fund Silver Lake invested another Rs 4,546.80 crore for additional 0.93 per cent stake in Jio Platforms.
Also, Abu Dhabi Investment Authority (ADIA) has taken 1.16 per cent equity stake in Jio Platforms.
With these investment, Reliance has sold about 22 per cent equity in Jio Platforms ahead of a potential IPO.
TPG is a leading global alternative asset firm founded in 1992 with more than USD 79 billion of assets under management across a wide range of asset classes, including private equity, growth equity, real estate and public equity.
Over TPG’s more than 25-year history, the firm has built an ecosystem made up of hundreds of portfolio companies and a value-added network of professionals, executives, and advisors around the world. Its investments in global technology companies include Airbnb, Uber, and Spotify, among others.
Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said, “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”.
TPG is making the investment from its TPG Capital Asia, TPG Growth, and TPG Tech Adjacencies (TTAD) funds.
“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,” TPG Co-CEO Jim Coulter said.
Ambani, 63, had in August last year set a target of March 2021, to make his conglomerate net debt-free. But thanks to the Facebook deal, a Rs 53,125 crore rights issue, private equity investments, and more stake sale to companies such as Saudi Aramco, the target is likely to be achieved by December.
At the end of March quarter, Reliance had an outstanding debt of Rs 3,36,294 crore and cash in hand of Rs 1,75,259 crore. After adjusting cash, the net debt came to Rs 1,61,035 crore.
Of the outstanding debt, Rs 2,62,000 crore is on Reliance books and Rs 23,000 crore is with Jio.