ADIA and PIF jointly invest $1.01 billion in Reliance’s fibre-optic assets

Reliance Industries is raising $1.01 billion investment from two Middle East Sovereign Funds. Abu Dhabi Investment Authority (ADIA) and Saudi Arabia’s Public Investment Fund, or PIF, will each invest $507.2 million in an Infrastructure Investment Trust (InvIT), which holds Reliance Industries’ fibre optics assets. It is unclear how much stake the two sovereign wealth funds would get in InvIT’s Digital Fire Infrastructure Trust (DFIT).

What is InvIT?

InvIT is a mechanism that enables developers of infrastructure assets to monetise them by pooling multiple projects under a single entity or a trust structure. InvITs are long-term instruments structured as funds with a very long tenure or open-end structure.

Mukesh Ambani is on a mission to transform his conglomerate into a retail and technology giant. He is aiming to expand the company’s wings in other domains apart from just oil-refining. He has already secured over $25 billion investment from global leaders like Facebook and Google.

Both ADIA and PIF are repeat investors.

The two sovereign investment bodies earlier pumped over $2 billion in Reliance Jio. PIF infused INR 11,367 ($1.5 Bn) for a 2.32% stake, while ADIA infused INR 5,683 Cr ($750 Mn) for 1.16% stake. They made the investment at an equity value of INR 4.91 Lakh Cr and an enterprise value of INR 5.16 Lakh Cr.

ADIA also said it will be investing INR 5,512.50 crore in Reliance Industries retail business. This investment would get ADIA a 1.20 per cent equity stake in RRVL. Apart from this, Mubadala, another Middle Eastern Investment Fund, holds a 1.89% stake in Jio Platforms. The same investment body possesses a 1.4% stake in Reliance Retail.

For its fibre-optics assets, Reliance has raised INR 25,215 crore investment for InvIT from Canada’s Brookfield Asset Management. This firm holds Reliance’s wireless tower assets. As per latest media reports, the Mukesh Ambani-led conglomerate is also said to be in talks with sovereign wealth fund Qatar Investment Authority to raise $1.5 billion for the same initiative.