Abu Dhabi wealth fund to invest $752m in Mukesh Ambani’s Jio platforms

The Abu Dhabi Investment Authority will invest $752m in Jio Platforms, joining a roster of marquee investors backing billionaire Mukesh Ambani's dream of creating an Indian tech titan.

Adia, the Gulf region's biggest sovereign wealth fund, will acquire a 1.16 per cent equity stake, the company said on Sunday, in a deal that values the Indian telecoms and digital services group at $65bn.

Abu Dhabi is the seventh investor to back the digital arm of Mr Ambani's Reliance Industries, since Facebook invested $5.7bn in April, a deal that gave Mark Zuckerberg an almost 10 per cent stake in the heavily indebted company.

Jio’s parent Reliance depends on oil refining and petrochemicals but in recent years it has pushed heavily into the country’s fast-growing technology market. That in turn has attracted the interest of some of the world’s largest private equity and sovereign wealth funds.

Mr Ambani, Asia's richest man, has sold over 20 per cent of Jio as he works to reduce Reliance’s net debt from over $20bn to zero by March next year. The collapse of demand for oil and refined products in the wake of the coronavirus pandemic have heaped pressure on Mr Ambani to shrink his debt pile.

US private equity firms Silver Lake, Vista Equity Partners, General Atlantic and KKR, along with Abu Dhabi's Mubadala have all taken stakes in recent months. The Financial Times previously reported that Saudi Arabia's Public Investment Fund is also in talks to invest about $1.5bn in the company.

Demand for oil products has collapsed in India after prime minister Narendra Modi imposed a harsh lockdown that triggered a mass exodus of contract labourers from cities and brought industry to a halt.

Jio upended India's telecoms market when it launched in 2016 with free calls and near-free data, winning 388m subscribers and leading to mass consolidation in the country's telecoms sector.

Mr Ambani has said that he plans on listing the company in five years. International investors are banking on Jio to give them access to India's fast growing digital market.

Cash-rich Gulf funds are on the hunt for deals as the world reels from the impact of the coronavirus crisis.

“Jio Platforms is at the forefront of India’s digital revolution,” said Hamad Shahwan Aldhaheri, executive director of the private equities department at Adia. “The rapid growth of the business, which has established itself as a market leader in just four years, has been built on a strong track record of strategic execution.”