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Jio Platforms – Silver Lake Deal Analysis: A Step Closer to Digital Economy 2.0

May 5, 2020

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US private equity firm Silver Lake announced an investment of USD 747 million (INR 5,655.75 crore) in Jio Platforms for a 1.15% stake on 4th May 2020, striking a deal with Jio less than two weeks after Facebook’s investment into Jio Platforms. The deal values Jio at $65 billion – a 12.5% premium to the value indicated by Facebook.

Silver Lake is a globally respected private equity firm with investments in technology companies, both large established firms, as well as, startups, with USD 40 billion in total AUM. Recent investments in E-commerce and financial technology include the Alibaba Group, Fanatics, Inc., Ant Financial, Credit Karma, and Blackhawk Network, among others.

The deal comes at a time when Reliance is working to pare down the group’s debts. In the midst of a pandemic, this deal coming into India stands testimony to the potential opportunities with data-led businesses in India.

What to expect for the Indian economy?

  • This deal can transform the retail market by significantly boosting digital consumer reach and monetization of transactional data and insights.
  • With this latest funding support, Jio Platforms will trigger growth of and series of large-ticket investments in consumer-experience digitization in India.
  • Low-cost digital services using social engagement tools will bring millions of suppliers in direct interaction with their target end-consumer base, enabling hyper-localization on the basis of cultural and behavioral consumption patterns.
  • Consumer-experience digitization will further create an impetus for emerging Deeptech solutions to converge, bringing forth opportunities that combine AI, Blockchain, IoT, AR/VR, and Big data at a massive scale to provide out-of-the-box digital experiences to Indians.
  • More such digital tech deals have the potential to push as-a-service and a digital as the foundation to drive India’s growth into the Techade to 2030.

References:

https://economictimes.indiatimes.com/

https://www.moneycontrol.com/news/business

https://www.techradar.com/in

https://brandequity.economictimes.indiatimes.com

Nasscom Research

 


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Shivani is taking care of Fintech research initiatives at NASSCOM having close to 10 years of experience in research and consulting in the areas of Banking, FinTech and related technologies

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