Reliance Jio gets ₹5,656 crore from private equity firm Silver Lake

Telco says latest investment at a 12.5% premium to the equity Facebook gained last month.

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Indian telco Reliance Jio has followed up its Facebook equity injection with the signing up of American private equity firm Silver Lake.

In a statement made on Monday, Jio said Silver Lake would put ₹5,655.75 crore into Jio Platforms.

"This investment values Jio Platforms at an equity value of ₹4.90 lakh crore and an enterprise value of ₹5.15 lakh crore and represents a 12.5% premium to the equity valuation of the Facebook," the company said.

Jio said it would now be part of a portfolio that includes, or has included, stakes in Airbnb, Alibaba, Ant Financial, Alphabet's Verily and Waymo, Dell Technologies, and Twitter.

Last month, Facebook parted with $5.7 billion, or ₹43,574 crore, to become the largest minority shareholder in Reliance Jio with just shy of 10% of equity.

The social network said the reason for its investment was to boost India's digital economy, especially its 60 million small businesses.

"For instance, by bringing together JioMart, Jio's small business initiative, with the power of WhatsApp, we can enable people to connect with businesses, shop and ultimately purchase products in a seamless mobile experience," the company said in a blog post.

"Our efforts with Jio will be focused on opening new doors and fueling India's economic growth and the prosperity of its people."

In its yearly financial results announced last week, Jio saw its standalone net profit increase 88% to ₹5,562 crore for the full year ended March 31.

For the fourth quarter alone, standalone net profit was ₹2,331 from standalone revenue of ₹14,835 crore. Standalone earnings before interest, tax, depreciation, and amortisation (EBITDA) for the fourth quarter was ₹6,201 crore.

The company said it now has 387.5 million subscribers, an increase of 26% year on year, with monthly average revenue per user of ₹130.6, or $1.73.

Data usage grew by 34% to 12.84GB and voice usage increased 21% year on year to 876 billion minutes. On a per-user basis, this translates to monthly data usage of 11.3GB and 771 minutes each. Over 70% of data is used for video, the telco said.

Jio said it had a handle on network pressures due to the coronavirus pandemic, with data increasing by more than 50% on its network.

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