The deal builds on a wave of fundraising activities announced by the oil and gas conglomerate in telecommunications in recent weeks, including a $ 7 billion share sale, with plans to phase out $ 21.4 billion dollars of net debt by the end of the year.
Reliance announced last week a 39% drop in quarterly profits, struck by a sharp drop in oil prices and a drop in fuel demand, and said at the time that it had sparked interest investors for a Facebook-like deal. He did not give more details.
The 56.56 billion rupees ($ 746.7 million) concern Silver Lake values Jio Platforms – the digital service entity that hosts the telecommunications arm of Reliance Jio Infocomm, its music and video streaming applications, at around 65 billion dollars, Reliance said in a regulatory brief here.
Silver Lake’s investment, at a premium of 12.5% over the valuation of Facebook’s stocks, gives it a little more than a 1% stake in Jio Platforms.
“Silver Lake has an exceptional record as a valued partner for the world’s leading technology companies,” said Reliance president and billionaire tycoon Mukesh Ambani in a statement. “We are delighted to leverage the knowledge of their global technological relationships for the transformation of the Indian digital society. “
Silver Lake has approximately $ 40 billion in assets under management, and its portfolio of companies includes social media company Twitter Inc (TWTR.N), computer hardware manufacturer Dell Technologies Inc (DELL.N) and the cinema chain AMC Entertainment Holdings Inc (AMC.N).
Unlike traditional mobile operators, who depended on voice services to make money, Ambani has always presented Jio, launched in late 2016, as a pioneering technology company that has helped hundreds of millions of Indians use the Internet for business. first time.
Facebook said late last month that it would buy a 9.99% stake in Jio Platforms as it seeks to capitalize on the 400 million WhatsApp user base in India and deploy services for grocers and small businesses.
The partnership will help Reliance use Facebook technology in its new operations, while allowing the American tech giant from India to massively reach a formidable partner in Ambani, who is widely seen as influential in government circles.
The Silver Lake investment highlights Reliance’s ability to monetize its digital service businesses and adds to the company’s already strong financial flexibility, said Moody’s Investors Service in a note.
Reliance shares, headquartered in Mumbai, were trading down 1.3 on a wider market in Mumbai .NSEI, down 4.9% to 0455 GMT.
(This story has been archived to remove the redundant letter from the title.)
Reports by Sankalp Phartiyal and Chris Thomas; Editing by Aditya Soni, Shri Navaratnam and Gerry Doyle
Our standards:Principles of the Thomson Reuters Trust.