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How Mukesh Ambani's Reliance Industries Limited became net debt-free

Jio deals and rights issue help RIL meet the target eight months ahead of the March 2021 deadline.

July 16, 2020 / 01:07 AM IST

Reliance Industries Limited said on June 19 it had become net debt-free eight months ahead of March 2021 deadline it had set for itself.

The target of making the oil-to-telecom behemoth debt-free was outlined by Chairman and Managing Director Mukesh Ambani at RIL’s 42nd Annual General Meeting on August 12, 2019.

"We have a very clear roadmap to becoming a zero net-debt company within the next 18 months, that is by 31st March 2021,” Ambani said. “We have received strong interest from strategic and financial investors in our consumer businesses, Jio and Reliance Retail. We will induct leading global partners in these businesses in the next few quarters and move towards listing of both these companies within the next five years. With these initiatives, I have no doubt that your company will have one of the strongest balance sheets in the world.”

As per Reliance Industries, the company's net debt was Rs 161,035 crore as on March 31, 2020.

The cumulative investment resulting from 11 deals struck by Reliance Industries for its digital unit, Jio Platforms, over the past nine weeks amounts to Rs 115,693.95 crore.

The recent RIL rights issue garnered Rs 53,124.20 crore. Together  with

Jio investments, it helped RIL become net debt-free.

Here is how it happened:  
S NoInvestor In Jio Platforms LimitedDate of InvestmentInvestment Amount      (₹ Crore)% Stake
1 Facebook, Inc.22nd April 202043,573.629.99%
2 Silver Lake Partners4th May 20205,655.751.15%
3 Vista Equity Partners8th May 202011,367.002.32%
4 General Atlantic17th May 20206,598.381.34%
5 KKR22nd May 202011,367.002.32%
6 Mubadala5th June 20209,093.601.85%
7Silver Lake Partners (additional investment)5th June 20204,546.800.93%
8Abu Dhabi Investment Authority7th June 20205,683.501.16%
9TPG13th June 20204,546.800.93%
10L Catterton13th June 20201,894.500.39%
11PIF18th June 202011,367.002.32%
Total  ₹ 115,693.9524.70%
RIL RIGHTS ISSUE20th May to 3rd June 2020₹ 53,124.20 
FUNDS RAISED IN 58 DAYS ₹168,818.15 

This is apart from its stake sale to UK-based multinational oil and gas giant BP.

Along with the stake sale to BP in the petro-retail JV, the total fund-raise is in excess of Rs 1.75 lakh crore, way higher than the company's debt as of March 2020.

Ambani's statement at the 42nd AGM had indicated investor interest in Jio.

Apart from this, Jio's rapid success in the telecom space drew the interest of investors globally. Three years after its launch, Jio Infocomm has emerged as the country's biggest telecom player, with a subscriber base of  38.75 crore.

The company also plans public listing of Reliance Retail and Jio over the next five years, a much-anticipated event for the market.

Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.
first published: Jun 19, 2020 12:53 pm
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