MUMBAI: Close on the heels of Reliance Jio announcing that it had offloaded a 9.99% stake to social networking giant Facebook, the telecom arm of Mukesh Ambani-controlled Reliance Industries Ltd confirmed Monday that private equity giant Silver Lake had picked up a further 1.15% stake in the telco.
Silver Lake’s investment in Jio, at an equity value of Rs 4.9 trillion and an enterprise value of Rs 5.15 trillion, represents a 12.5% premium to the equity valuation of the Facebook investment announced on April 22.
Commenting on the transaction, Ambani said: “I am delighted to welcome Silver Lake as a valued partner in continuing to grow and transform the Indian digital ecosystem for the benefit of all Indians. Silver Lake has an outstanding record of being a valuable partner for leading technology companies globally. Silver Lake is one of the most respected voices in technology and finance. We are excited to leverage insights from their global technology relationships for the Indian Digital Society’s transformation.”
Egon Durban, Silver Lake co-CEO and managing partner, added: “Jio Platforms is one of the world’s most remarkable companies, led by an incredibly strong and entrepreneurial management team who are driving and actualizing a courageous vision. They have brought extraordinary engineering capabilities to bear on bringing the power of low-cost digital services to a mass consumer and small businesses population. The market potential they are addressing is enormous, and we are honored and pleased to have been invited to partner with Mukesh Ambani and the team at Reliance and Jio to help further the Jio mission.”
While Silver Lake’s investments include Airbnb, Alibaba, Ant Financial, Alphabet’s Verily and Waymo units, Dell Technologies, Twitter and numerous other global technology leaders, it is also a major player in the sports arena.
These investments include a 10% stake in City Football Group (CFG), which owns Premier League side Manchester City as well as Indian Super League franchise Mumbai City FC. CFG backs football clubs New York City FC, Melbourne City FC, Yokohama F. Marinos in Japan, Club Atletico Torque in Uruguay, Girona FC in Spain and Sichuan Jiuniu FC in China.
It was in November 2019 that Silver Lake made a $500 million equity investment in CFG (primary shareholder Abu Dhabi United Group) equivalent to just over 10% of the company’s post-investment value. The deal valued CFG at $4.8 billion post-investment.
CFG also backs soccer clubs New York City FC, Melbourne City FC, Yokohama F. Marinos in Japan, Club Atletico Torque in Uruguay, Girona FC in Spain and Sichuan Jiuniu FC in China.
Then there is Endeavor, which owns and operates the full portfolio of brands formerly under the WME | IMG banner, whose businesses include IMG Academy, art + commerce, books, college, commercials and endorsements, digital, events, film, golf, licensing, models, music, production, speakers, television, tennis, and theatre.
It is worth noting that it was in 2016, in the most expensive transaction in sports history, that WME | IMG bought Ultimate Fighting Championship, the world’s premier mixed martial arts organisation, for $4 billion.
UFC is one of the largest pay-per-view (PPV) event providers in the world, and its content is broadcast in over 156 countries and territories to nearly 1.1 billion television households worldwide.
And third is The Madison Square Garden Company, one of the most iconic sports and entertainment venues in the world. Silver Lake owns a minority stake in the NYSE listed enterprise, which also owns other popular venues like Hulu Theater, Radio City Music Hall and Beacon Theatre, the Forum in Inglewood, California and The Chicago Theatre.
The fact that both Jio’s new investors also see a huge opportunity in the world of sports portends interesting times for the big ticket stakeholders in India sports.
There is also the back story of Mukesh Ambani’s first major play into sports that is worth noting for the record. It was Ambani’s good friend the late Ted Forstmann, then chairman and chief executive of IMG Worldwide, who reportedly piqued the Indian tycoon’s interest in sports. The rest, as they say, is history. A history that is today being scripted not by the RIL chairman but by his wife Nita Ambani, it must be said.
