Saudi wealth fund PIF takes stake in Jio Platforms for Rs 11,367 crore

Jio Platforms has signed up Public Investment Fund (PIF) as its tenth foreign investor in just over eight weeks. The Saudi Arabian sovereign wealth fund will pick up 2.32 per cent stake in the Reliance Industries subsidiary for Rs 11,367 crore (US$ 1.6 billion), a release issued by the Mr Mukesh Ambani company.

This investment has given Jio Platforms an equity valuation of Rs 4.91 trillion (US$ 69.66 billion) and an enterprise value of Rs 5.16 trillion (US$ 73.20 billion).

The total investment by foreign investors in Jio Platforms has reached Rs 1.15 trillion (US$ 16.31 billion) for a 24.71 per cent combined stake in the company.

Till now, the list of investors in Jio includes PIF, Facebook; six private equity companies namely General Atlantic, TPG, KKR, Silver Lake, L Catterton, Vista Equity Partners and two sovereign funds of Abu Dhabi -- Abu Dhabi Investment Authority and Mubadala Investment Company.

The company announced its first and largest stake sale of all of 9.99 per cent equity to Facebook for Rs 43,573.62 crore (US$ 6.18 billion), on 22 April 2020.

Silver Lake invested in Jio in two instalments. These transactions are subject to regulatory approvals, with the one with Facebook likely to undertake a tighter scrutiny given concerns over net neutrality. The Competition Commission of India, the antitrust watchdog, is currently looking over the deal with Facebook.

Reliance Jio Infocomm has over 388 million subscribers, will continue to be a wholly owned subsidiary of Jio Platforms.

These stake sales are part of RIL's plan to be debt-free by March 2021. Although, the company expects to achieve the target by December, the parent company having mopped up Rs 53,124 crore (US$ 7.54 billion) from a rights issue that closed on 4 June.

Out of these, Rs 43,574 crore (US$ 6.18 billion) will be received from Facebook, Jio plans to utilise Rs 28,000 crore (US$ 3.97 billion) to redeem optionally convertible preference shares (OCPS) of its parent RIL and retain Rs 15,000 crore (US$ 2.13 billion) in its books, Jio's top management had said in a conference call on 22 April.

 

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