India's leading digital Jio Platform is going to get an investment of $1.50 billion from American global investment firm KKR, Reliance Industries announced on May 22. This is going to be KKR's largest investment in Asia.
Through this funding, KKR will get 2.32 percent of the equity stake in Jio Platforms on a fully diluted basis. "This transaction values Jio Platforms at an equity value of $6,471 billion and an enterprise value of $6,800 billion ... " reads the statement.
Some of the leading technology investors such as Facebook, Silver Lake, Vista, General Atlantic including KKR have announced an aggregate investment of $10 billion in Jio Platforms over the last month.
Jio Platforms, which is a wholly-owned subsidiary of Reliance Industries, is a technology platform focused on providing high-quality and affordable digital services across India. It has more than 388 million subscribers. Jio Platforms has made significant investments across its digital ecosystem, powered by leading technologies spanning broadband connectivity, smart devices, cloud and edge computing, big data analytics, artificial intelligence, Internet of Things, augmented and mixed reality and blockchain.
Reliance Industries Limited is India's largest private sector company, with a consolidated turnover of $87.1 billion, cash profit of $9.4 billion and net profit of $5.3 billion for the year ended March 31, 2020. "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," said Mukesh Ambani, Chairman and Managing Director of Reliance Industries.
KKR invests private equity, energy, infrastructure, real estate, and credit, and has strategic partners that manage hedge funds. It invests its own capital alongside the capital it manages for fund investors and provides financing solutions and investment opportunities through its capital markets business. "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 the company.
Legal and Financial Advisors
For such a huge investment in India's largest private sector company, Morgan Stanley acted as financial advisor to Reliance Industries, and AZB & Partners and Davis Polk & Wardwell acted as legal counsel. Deloitte Touche Tohmatsu India LLP acted as financial advisor to KKR. Shardul Amarchand Mangaldas & Co and Simpson Thacher & Bartlett LLP acted as legal counsel to KKR.