SILVER LAKE

The network services globally are trying to strengthen their foundation in this emergency period. People are relying on mobile phone and internet services to communicate with their loved ones in such a crisis. So, it is one of the topmost priorities of the networking companies to improve their communication system. With the lockdown continuing for over a month, many companies are also strategizing for the post-pandemic period. In India, Jio Platforms is currently the widest and largest telecom operator. After Jio has established in our country, millions of people have received access to the internet and that is the reason companies like Facebook and Silver lake are investing in JIO. This means the network of Jio is making the basic means of communication affordable to every citizen of India. And, a company with such potential is bound to draw the attention of big investors.

Facebook’s investment

Last month, Facebook announced that it will be investing $5.7 billion in Reliance subsidiary Jio Platforms. This made Facebook the largest minority shareholder of Jio Platforms. Facebook said that if social media platforms partners with the largest network enterprise of India, it can bring a revolution. This investment was made with a strong mission to connect more people through the power of Whatsapp and Jio’s small businesses.

Who is the new investor?

After a few weeks, Jio receives a huge amount of funding from a private equity firm, Silver Lake. The new investor has announced its partnership with Jio Platforms today. Silver Lake is investing around $746.8 million in Jio which will help the company gain 1.15% of its stake. The valuation of this stake rounds up to $65 billion and the company is willing to pay a premium as well (12.5% premium).

Silver Lake is a private equity firm based on Menlo Park, California, United States. The company has invested in many tech giants making it one of the largest technology investors around the globe. The company’s total combined assets and committed capital round up to $40 billion. Founded in 1999, Silver Lake has made investments in more than 40 companies through minority growth investments, PIPE investments, and leveraged buyout transactions.

Some of the biggest companies that Silver Lake has invested in are Dell, Alibaba, Seagate Technology, IMG Worldwide, Skype, etc. The company has already invested in Airbnb, Twitter, and Waymo this year. After investing in Eka, this is the second time Silver Lake is investing in an Indian enterprise.

Jio Platforms and Silver Lake

Ambani said that’s several firms are showing interest in investing in Jio Platforms. With the recent developments in the Indian telecom industry taking place due to Jio, it is obvious to attract investors. Ambani has invested over $30 billion to make Jio Platforms a big success over the years. And, he believes that after partnering with Facebook for e-commerce, Silver Lake will help in expanding its service.

In response to coming into a joint venture with Silver Lake, Ambani said that it’s outstanding to have such a valuable partner onboard. Moreover, Silver Lake being one of the most famous investors for tech has an advantage. He is looking forward to making significant contributions along with Silver Lake to transform the Indian Digital Society.

Although Jio Platforms is selling 1.15% of its stake, the class of shares is still vague. The company hasn’t shown much light on this topic. But, if the class of shares is the same as it sold to Facebook, there are high chances Jio Platforms is planning to file an IPO. Currently, the main target of the company is to cut its net debt from $21 billion to zero by next year. Also, due to the outbreak of novel coronavirus, the company has suffered huge losses in the sector of petrochemicals and oil refining. So, the company is looking forward to making up the damages through this new partnership.

An already powerful platform

From the beginning of Jio’s establishment, it has been a very strong service provider. Jio Platforms is the most valued subsidiary of Reliance Industries according to the market value. After the company was launched until now, it has managed to provide 338 million people with internet and other mobile services. Jio realized the importance of digital services and thus targeted low-cost digital services for mass consumers.

Egon Durban, co-chief executive and managing partner of Silver Lake said that Jio has extraordinary engineering capabilities. And, they are honored to have partnered with Jio to help them get once step closer toward the digital goal.