Recent reports suggest that Ambani’s Reliance Jio is in advanced talks with the sovereign wealth funds from the Middle East to invest in the digital arm of the business.
Though the information is private, people familiar with the matter think that an announcement regarding Abu Dhabi’s Mubadala Investment Co.’s investment in the Jio Platforms Ltd can be expected this week. They are speculated to be investing about $1 billion. Mukesh Ambani is also said to be in talks with Abu Dhabi Investment Authority and Saudi Arabia’s The Public Investment Fund. If the deal is successful, Jio Digital is slated to raise $14.3 billion in a matter of months.
The reports suggest that the total investment of the three entities will come up to around $2 billion with the PIF investing an amount somewhere between $1.1 to $1.5 billion and Abu Dhabi sovereign investments coming up to $1 billion to $1.25 billion.
This may be the last round of fundraising for Jio Platforms as their target was $11.2 to $11.9 billion and they are likely to exceed this target once this deal with the GCC sovereign funds comes through.
The Jio Platforms, with movie and music apps and also its telecommunication venture- Jio Infocomm, has raised $10 billion in investments since April from the likes of Facebook Inc and KKR and is looking for an overseas listing. Microsoft is also, reportedly, close to investing $2 billion in the platform.
India’s massive consumer market and Jio’s potential to bring about changes in the country’s traditional industries are attracting investors greatly. With the investments, Ambani aims to slash debt at Reliance Industries.
The reports said the negotiations could take more time or still fall apart. The representatives from ADIA, Mubadala, PIF and Reliance declined to offer any comment on these speculations.
Abu Dhabi Investment Authority invests in technology assets, both publicly listed and private. Mubadala invests in several sectors like aerospace, information and communications technology, real estate and infrastructure, petroleum and petrochemicals, healthcare, renewables, utilities, semiconductors, metal and mining.
Reliance and its subsidiaries have invested over $2 billion in its four-pronged strategy to become a technology powerhouse, suggests reports. The Indian conglomerate has outperformed the 18% drop in the benchmark S&P BSE Sensex Index as its shares have risen 2.4%.
