When companies across the world are battling the Covid-19 headwinds, one of India’s largest conglomerate Reliance Industries Limited (RIL) has raised over ₹1 lakh crore via selling stake to several multinational giants and Rights Issue.
Crux of the Matter
Seven Strikes
22 April – Facebook invested ₹43,574 crores in Jio, acquiring a 9.99% stake.
03 May – Private equity firm Silver Lake announced that it will invest ₹5,655.75 crores into Jio Platforms for a 1.15% stake.
08 May – Vista Equity Partners announced an investment of ₹11,367 crores in Jio Platforms for a 2.32% stake.
17 May – General Atlantic, a US investment firm, bought a 1.34% stake by investing ₹6,600 crores in Jio Platforms.
22 May – RIL announced KKR will invest ₹11,367 crores into Jio Platforms for a 2.32% equity stake.
05 June – Abu Dhabi sovereign fund Mubadala Investment Company announced infusion of ₹9,093.6 crores in Jio Platforms in exchange for 1.85%. Silver Lake announced an additional investment of ₹4,547 crores for a 0.93% stake.
07 June – Abu Dhabi Investment Authority bought a 1.16% stake in RIL for ₹5863.50 crores.
Response To Rights Issue Reliance Industries Limited came up with a Right Issue, which was oversubscribed 1.59 times. The issue would raise 25% of the total corpus now and the other 75% later in 2021. RIL would receive ₹13,280. A rights issue is a way by which a listed company can raise additional capital by only giving its existing shareholders the right to subscribe to newly issued shares in proportion to their existing holdings. The amount of investment is expected to act as a catalyst to Mukesh Ambani’s plan of making Reliance a debt-free company. The company’s debt as on 31st March 2020 stood at ₹1,61,035 crores. Reliance is likely to be debt-free three months before its scheduled date, i.e by December 2020 than March 2021.
Curiopedia
On March 23, 2018, Reliance Industries Ltd acquired a majority stake in Saavn, Indian online music streaming service, and combined Saavn with its own digital music service, JioMusic. The combined entity is valued at over $1 billion and rebranded as JioSaavn.
Guru is a 2007 Indian drama film starring Abhishek Bachchan, Aishwarya Rai, Madhavan, Vidya Balan, Arya Babbar, and Mithun Chakraborty in the leading roles. The film is loosely based on the life of one of India’s biggest industrial tycoons, Dhirubhai Ambani.
KKR & Co. Inc. is an American global investment firm that manages multiple alternative asset classes. The firm has completed more than 280 private equity investments in portfolio companies with approximately $545 billion of total enterprise value. The firm was founded in 1976 by Jerome Kohlberg, Jr., and cousins Henry Kravis and George R. Roberts, all of whom had previously worked together at Bear Stearns.
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