Indian billionaire Mukesh Ambani is still doing deals at Reliance Industries in spite of the country’s struggle with the coronavirus pandemic.
Eversince Facebook said on April 22 that it would invest $5.7 billion to acquire a 9.99% stake in Jio Platforms, Reliance’s fully-owned digital subsidiary, a number of some of the world’s most prominent tech giants and investors have followed suit.
The Nikkei Asian Review has reported that American private equity funds Vista Equity Partners, Silver Lake, KKR and General Atlantic have announced investments totaling $4.6 billion in Jio Platforms.
Reliance Industries is also carrying out India’s largest rights issue, and is inviting investors to subscribe for more shares. The Indian behemoth plans to raise $7 billion to enable Reliance fulfill its pledge of cutting group net debt, which had reached $22 billion, to zero by March 2021.
With the rights issue and stake building in Jio, Mukesh Ambani is demonstrating confidence in his investment pitch: that his company can reinvent itself from its industrial legacy and become a consumer-facing tech giant that will be at the vanguard of India’s digital future.
“Our vision is always rooted in furthering India’s inclusive and accelerated growth, propelled by the adoption of digital technologies, that helps improve the lives of 1.3 billion Indians … our shareholders endorse this vision and mission. Their support further strengthens our resolve as we firmly set forth to build a New Reliance for a New India,” he said in a statement after the rights issue concluded on June 3.
For years Reliance, which was founded by Ambani’s father, Dhirubhai Ambani, as a textiles business in 1966, was an “old economy” entity. Reliance dominates swaths of Indian industry. Its Jamanager oil refinery is the world’s largest. Marrying its textiles and petrochemicals segments, Reliance also claims to be the world’s largest producer of polyester fiber. Today, Reliance owns TV channels and cable TV operators that distribute content through Jio. Similarly, its physical retail network — the group is India’s largest retailer — is being connected and expanded online.