General Atlantic invests $870m in India’s Jio Platforms

18 May 2020147 Views

Share on FacebookTweet about this on TwitterShare on LinkedInPin on PinterestShare on RedditEmail this to someone

Image: © piter2121/Stock.adobe.com

Share on FacebookTweet about this on TwitterShare on LinkedInPin on PinterestShare on RedditEmail this to someone

General Atlantic has joined Facebook, Silver Lake and Vista Equity Partners in investing in Indian telecoms business Jio Platforms.

New York-headquartered private equity firm General Atlantic has said that it will invest $870m in Indian telecom operator Jio Platforms.

Jio, which is a subsidiary of Indian firm Reliance Industries, has attracted major US investors in recent weeks, including Facebook, Silver Lake and Vista Equity Partners.

On 22 April, Facebook announced that it invested $5.7bn in the company for a 9.9pc stake, making Facebook the largest minority shareholder. The deal gave Jio Platforms a pre-money valuation of $65.95bn.

On Sunday (17 May), the Indian company said that General Atlantic will take a 1.34pc stake in an $870m deal. In the last month, Jio Platforms has raised $8.85bn by selling 14.7pc of its stake to foreign investors, according to TechCrunch.

What is Jio Platforms?

In 2010, Reliance Industries chair and managing director Mukesh Ambani moved into the telecoms sector after Reliance took a 95pc stake in Indian internet service provider Infotel Broadband Services Limited (IBSL) .

According to Fortune, Ambani rebranded ISBL as Jio Platforms in 2013. Three years later, he invested $33bn to build out India’s 4G broadband service network, attracting hundreds of millions of Indian customers from other telecoms operators and eventually making Ambani the richest man in India.

Support Silicon Republic

The telecoms business now has more than 388m subscribers and has launched other services including music streaming, consumer electronics, on-demand live television and a payments service.

It plans to open a Jio University in 2021, with programmes related to artificial intelligence, data science, digital media and integrated marketing communication for undergraduates. It is also launching a nationwide e-commerce platform, JioMart, to compete with Amazon and Flipkart.

Recent investments

Commenting on General Atlantic’s investment in the business, Ambani said: “General Atlantic shares our vision of a digital society for India and strongly believes in the transformative power of digitisation in enriching the lives of 1.3bn Indians.

“We are excited to leverage General Atlantic’s proven global expertise and strategic insights across 40 years of technology investing for the benefits of Jio.”

Sandeep Naik, managing director and head of India and south-east Asia at General Atlantic, added: “In just three and a half years, Jio has had a transformational impact in democratising data and digital services, propelling India to be positioned as a leading global digital economy.”

Facebook has said that as well as offering the telecoms business capital through its stake, it also plans to work with Jio Platforms to roll out its e-commerce platform and has begun testing an online ordering system on WhatsApp.

Kelly Earley is a journalist with Siliconrepublic.com

editorial@siliconrepublic.com