Saudi Arabia's Public Investment Fund plugs $1.5 bn into Jio Platforms

Saudi Arabia's Public Investment Fund plugs $1.5 bn into Jio Platforms
Photo Credit: VCCircle
18 Jun, 2020

Riyadh, Saudi Arabia headquartered Public Investment Fund (PIF) has agreed to invest close to $1.5 billion (about Rs 11,367 crore at current exchange rates) in Reliance Industries' (RIL) telecom subsidiary Jio Platforms.

Post investment, the sovereign wealth fund will own 2.32% equity stake in Jio Platforms on a fully diluted basis, a statement said. The investment values Jio Platforms at an equity value of $65 billion (Rs 491,000 lakh crore) and an enterprise value of $68 billion (Rs 516,000 lakh crore). 

With this investment, the total tally of funds raised by the company stands at $15.2 billion (Rs 115,694 crore) since the first external infusion from social media major Facebook on April 22.

Global private equity players including Silver Lake, Vista Equity Partners, General Atlantic, KKR, Mubadala Investment Company, Abu Dhabi Investment Authority (ADIA), TPG and L Catterton have already infused funds in the company.  

PIF will be the tenth investor external investor overall and third sovereign wealth fund from the Middle East to have invested in Jio Platforms.

“We at Reliance (RIL) have enjoyed a long and fruitful relationship with the Kingdom of Saudi Arabia for many decades. From Oil Economy, this relationship is now moving to strengthen India’s new oil (data-driven) Economy, as is evident from PIF’s investment into Jio Platforms," Mukesh Ambani chairman and managing director of RIL said.

Founded in 1971,  PIF invests in domestic and international commercial and infrastructure projects. Its key foreign investments include Softbank Vision Fund, Blackstone Infrastructure Fund and joint project financing in France and Russia, according to information on its website. PIF also owns 5% stake in global shared mobility firm Uber for an investment of $3.5 billion. In 2015, Saudi Arabia's crown prince, Prince Mohammed Bin Salman Bin Abdulaziz was appointed as the chairman of PIF.

"We believe that the potential of the Indian digital economy is very exciting and that Jio Platforms provides us with an excellent opportunity to gain access to that growth. This investment will also enable us to generate significant long-term commercial returns

for the benefit of Saudi Arabia’s economy," Yasir Al-Rumayyan, governor of PIF said.