Vista Equity Partners to invest in Jio Platform for 2.32% Stake

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Vista Equity Partners to invest in Jio Platform for 2.32% Stake

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Reliance Jio And Vista Equity Partners Deal: Everything to Know ...

What happened?

Reliance Jio secured three large investments recently. It announced its 3rd deal on May 8th with US based investment company Vista Equity. Before this on 22nd April social media giant Facebook announced to invest in Mumbai based telecom company Reliance Jio. Facebook purchased 9.99% equity stake in Reliance Jio for Rs. 43,574 crore ($5.7 billion). Social media platform, Facebook is the 2nd largest stake holder in Reliance Jio after Reliance industries. After this deal Reliance Jio cracked another deal with US based firm Silver Lake. On May 4th equity firm Silver Lake decided to invest in reliance Jio Rs.5665.75 crore.

So What?  

Reliance Jio which is the fastest growing telecom company in India has announced to sell 2.32% stake to Vista Equity for a amount of Rs. 11,367 crore($1.5 billion). Vista equity is the 3rd largest stake holder after reliance industries and Facebook in Jio. “Vista’s investment values Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore”. The investment done by vista equity is nearly same as investment by silver lake. Vista’s investment will translate into a 2.32% equity stake in Jio Platforms on a fully diluted basis. “Like our other partners, Vista also shares with us the same vision of continuing to grow and transform the Indian digital ecosystem for the benefit of all Indians. They believe in the transformative power of technology to be the key to an even better future for everyone,” said Mukesh Ambani.

Vista Equity Partners gets 2.32% stake in Reliance Jio through Rs ...

“In Robert and Brian, whose family hails from Gujarat, I found two outstanding global technology leaders who believe in India and the transformative potential of a digital Indian society. We are excited to leverage the professional expertise and multilevel that vista has been offering to its investment globally for the benefit of the Jio” he added.

“We are thrilled to join Jio platforms to deliver exponential growth in connectivity across India, providing modern consumer, small business and enterprise software to fuel the future of one of the world’s fastest growing digital economies” said Robert F. Smith founder, CEO and chairman of Vista.

The main motive of reliance industries in selling stake of Reliance Jio platforms is to become debt free company by March 2021. These outside investments will help them achieve the goal of the company. The deal will help to eliminate the debt of $21.4 billion by the end of the year. Jio platforms include Jio savaan, MyJio, Jiomart, Jiocinema, JioNews.

Now what?                                                 

These investments will help in transforming Indian market digitally. Further Reliance Jio is looking forward to sell more stakes of the company. Saudi Arabia public investment fund is interested to invest in Reliance Jio. Sources says that talks are still going on. Saudi Arabia’s $320bn sovereign wealth fund may purchase minority share in Jio. Another US based private equity company called General Atlantic is interested in investing in Reliance Jio. They are planning to invest $850 million to $950 million in Jio. Both the companies are in talks. Although nothing is finalized yet no agreement has been made, deal may change. The deal may be done by the end of the month. When asked about the deal representative from both the company, they didn’t respond immediately and said information was private. In less than three weeks Mukesh Ambani so far has raised Rs. 60,596.37 crore for Jio platforms from biggest technology investors. Any new investment into Jio Platforms will add to the $8 billion run, that the billionaire Mukesh Ambani has sealed in the past few weeks.

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