Via Financial Times

US private equity company KKR is set to become the latest high-profile foreign investor to help bankroll billionaire Mukesh Ambani’s ambition to turn Jio Platforms into an Indian tech giant, people with familiar with the matter said.

KKR is in advanced talks to buy a $1.5bn stake at a valuation as high as $65bn for the fast-growing Indian digital company, one of the people said. Jio is part of Mr Ambani’s sprawling oil products-to-telecoms conglomerate Reliance Industries.

Separately, Abu Dhabi’s sovereign wealth fund, Mubadala, is considering buying a stake of up to $1.2bn in Jio, this person said.

Another person, who has been briefed on Mubadala’s strategy, said: “We are looking at it, but [it’s] a few weeks off.” He added that Jio could “fit well” into the sovereign wealth fund’s technology portfolio.

Over the past month, Reliance has attracted almost $9bn of investment from a string of top US investors. Mr Ambani, India’s richest man, is pursuing the sale of roughly 20 per cent of Jio.

Saudi Arabia’s Public Investment Fund is also in discussions to invest about $1.5bn in the company, the Financial Times reported previously.

The coronavirus pandemic and a collapse in demand for oil and refined products have added to the pressure on Mr Ambani to raise cash to shrink Reliance’s $20bn net debt pile that it took on to build Jio.

Mr Ambani is also paving the way for an initial public offering of Jio, which is expected in the next five years.

Private equity group General Atlantic on Sunday became Jio’s fourth major foreign investor in as many weeks, agreeing a deal for an $870m stake. US private equity firms Vista Equity Partners and Silver Lake had already announced their own investments in Jio, at $1.5bn and $750m respectively, following an April deal by Facebook for a huge $5.7bn stake.

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Reliance used cash from its core oil products business to launch Jio in 2016, enticing 388m subscribers with cheap 4G data plans. It has since diversified beyond telecoms into ecommerce and broadband services, offering global investors a route into the fast-growing Indian market. 

Mubadala, one of the UAE’s most active sovereign wealth funds, has a wide-ranging portfolio that includes stakes in a telecoms company, data centres and a satellite telecommunications group.

In recent years, Mubadala Capital’s Ventures arm, based in Abu Dhabi and San Francisco, has sought to extend investments in technology, via a fund of funds and Mubadala’s $15bn commitment to SoftBank’s Vision fund.

Mubadala, like other cash-rich wealth funds, has been scouring the globe for bargains across a corporate landscape ravaged by the economic toll of Covid-19. The fund has in recent years been monetising investments, building a cash pile that can be deployed for opportunities.

The Economic Times earlier reported on KKR and Mubadala’s interest.

Jio did not respond to a request for comment. Mubadala and KKR declined to comment.