- Reliance Industries (RIL) will sell 2.3 percent of the Jio Platforms stake to Vista Equity Partners for Rs. 11,367 crores, giving its subsidiary a 4.91 trillion equity valuation.
Reliance Industries (RIL) will sell 2.3 percent of the Jio Platforms stake to Vista Equity Partners for ~11.367 crores, giving it’s subsidiary a 4.91 trillion equity valuation. This is RIL’s third-largest stake sale in Jio in just over two weeks, with social media giant Facebook and private equity (PE) Silver Lake participating in earlier rounds.
The 2.3 percent stake sale is at a marginal premium to the Silver Lake deal where a 1.15 percent stake has been paid by the PE fund for 5,655.75 crores. The Vista deal thus comes to the Silver Lake deal at a premium of just 0.5 percent.
Three global companies now own 13.4 percent in Jio Platforms now owns. All three transactions are subject to regulatory approvals, with Facebook likely to undergo tighter scrutiny given net neutrality concerns.
The three stake sales form part of RIL’s strategy to be free from debt by March. Most likely, the target would probably be hit before that. Jio raised a crore of about 60,596.37 across the three rounds of fundraising.
Of the as many as 43,574 crores it will earn from Facebook, Jio aims to use as many as 28,000 crores to redeem its parent RIL’s optionally convertible preferred shares (OCPS) and to hold as many as 15,000 crores in its accounts.
The deal’s news sent the RIL share price spurting by 3 percent in the session underway today to climb to the day’s high of some 1,550 so far. The wider index, the BSE Sensex, increased at 31,885 points by 1.4 percent or 457 points.
After RIL and Facebook, Vista will become the major investor in Jio Platforms. On April 22, Facebook entered into an agreement to invest $5.7 billion for a 9.99 percent stake in Jio Platforms, followed by global private equity firm Silver Lake agreeing to invest Rs 5,655.75 crore in Jio Platforms on May 4 for a 1.15 percent stake.
Reliance Jio Infocomm will continue to be a wholly-owned subsidiary of Jio Internet, which offers a communication network to over 388 million subscribers.
RIL is also raising some $553,215 crores via a rights issue as part of its debt-free plans. According to a Mint report, the company has named nine investment banks to fundraise its plans.
Vista portfolio companies have a significant presence of more than 13,000 employees in India, which has total capital investments of more than $57 billion and has so far invested primarily in business software firms.
