Jio Picks INR 11,367 cr from KKR, totaling its funding so far to INR 78,562 cr
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US-based private equity (PE) firm KKR will invest INR 11,367 crore in Jio Platforms, a unit of Mukesh Ambani owned Reliance Industries (RIL) for an equity stake of 2.32 per cent on a fully diluted basis.
This deal comes exactly one month after RIL announced the very first funding of INR 43,574 crore ($5.7 bn) by social media giant Facebook in Jio Platforms. Over the last month, five technology investors—Facebook, Silver Lake, Vista, General Atlantic and KKR—have announced aggregate investments of INR 78,562 crore into Jio Platforms.
Investment by KKR values Jio Platforms at an equity value of INR 4.91 lakh crore and an enterprise value of INR 5.16 lakh crore, as per a statement from RIL.
“KKR shares our ambitious goal of building a premier Digital Society in India. KKR has a proven track record of being a valuable partner to industry-leading franchises and has been committed to India for many years. We are looking forward to leveraging KKR’s global platform, industry knowledge and operational expertise to further grow Jio,” said RIL Chairman and MD Mukesh Ambani.
KKR is known for its investments in businesses in the technology sector, including BMC Software, ByteDance and GoJek through its PE and technology growth funds. Since its inception in 1976, the firm has invested over $30 billion in tech companies and currently its technology portfolio has more than 20 companies across the Technology, Media and Telecom sectors. The firm forayed in India in 2006 and has made investments in Bharti Infratel, Coffe Day Resorts (a subsidiary of CCD group), EuroKids and Max Financial Services, among others.
“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,” said Henry Kravis, Co-Founder and Co-CEO of KKR in RIL’s statement. The investment firm will make the investment from its Asia PE and growth technology funds.
The latest deal with KKR inches RIL a step closer to its plan of cuting its debt of INR 1.53 trillion and become net debt free by March 2021. Late in April, RIL had stated that it will achieve the zero net debt status ahead of schedule as it is confident about completing the capital raising programme totaling over INR 1.04 lakh crore by Q1 of the current financial year. After today’s deal, RIL is short of about INR 25,430 cr of this target.
Jio Platforms is the umbrella entity of phone and data unit Jio Infocomm and several other app platforms such as JioMart, JioSaavn and JioCinema.