Jio Platforms receives $1.5 billion investment from US equity firm KKR

KKR investment in Jio Platforms
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Indian tech company Jio Platforms has received a new wave of investment worth 113.7 billion rupees or $1.5 billion via US equity firm KKR.

Jio Platforms, owned by Asia’s richest man Mukesh Ambani, announced that it received an investment of $1.5 billion from private equity giant KKR. This brings the total amount of cash raised by Jio to $10 billion in the past four weeks.

In a statement, Ambani said the investment would enable the tech company to take advantage of “KKR’s global platform, industry knowledge and operational expertise to further grow Jio.”

Jio Platforms and Recent Investments

Jio Platforms is digital technology arm of conglomerate Reliance Industries, owned by the Indian billionaire Ambani.

The company provides various services under its umbrella, including the mobile network Reliance Jio, which has signed up almost 390 million subscribers since its launch three and a half years ago.

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Tech giant Facebook has acquired a 9.99% stake in Jio for $5.7 billion to take a key foothold in India, one of the world’s fastest growing internet markets.

JioMart, Reliance’s retail arm, is forming a partnership with Facebook-owned messaging platform WhatsApp that could potential enable Facebook to monetize WhatsApp’s users in India.

Ambani expressed that Reliance is “humbled by the opportunity to welcome Facebook as our long-term partner in continuing to grow and transform the digital ecosystem of India.”

In a statement, Facebook’s chief revenue officer David Fischer and vice president and managing director for India Ajit Mohan emphasized: “This investment underscores our commitment to India, and our excitement for the dramatic transformation that Jio has spurred in the country.”

They also said that the firm plans to focus on the partnership between WhatsApp and Reliance’s e-commerce venture JioMart to enable people to connect with businesses, shops and purchase products.

US private equity firm Silver Lake, which is known for its winning track record of placing investments in promising tech giants, is also investing $748.5 million in Jio Platforms.

According to Reliance, the additional funds will be used by Jio Platforms to expand its digital services.

Ambani said: “Silver Lake is one of the most respected voices in technology and finance. We are excited to leverage insights from their global technology relationships to fuel India’s transformation into a digital society.”

KKR and the future of Jio

The private equity firm has almost $220 billion in assets under management, which it invested in several high-profile tech companies including TikTok-owner ByteDance, GoJek, Lyft and Epic Games.

KKR co-founder and co-chief executive officer (CEO) Henry Kravis called Jio’s momentum as a company “impressive.”

In a press release, Kravis said: “Few companies have the potential to transform a country’s digital ecosystem in the way that Jio Platforms is doing in India, and potentially worldwide.”

His comments affirm what analysts claim to be Ambani’s ultimate goal for Jio, which is to establish the next global technology company, one that can compete with the likes of Google, Tencent, Amazon and Alibaba.

The recent investments will be used to expand Jio Platform’s business, as well as pay the growing debt of its parent company. The coronavirus pandemic has greatly affected the oil and energy industry, which is a big part of Reliance’s business.

At a shareholders meeting last year, Ambani said he aims for Reliance to become a “zero net debt company” by March 2021 and as of March 2020, the parent company had around $44 billion of debt on its books.

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