On Wednesday, Facebook announced an investment of USD 5.7 billion (Rs 43,574 crore) to buy a 10% stake in Jio.
Facebook said in a statement, “Today we are announcing a USD 5.7 billion, or Rs 43,574 crore, investment in Jio Platforms Ltd, part of Reliance Industries Ltd, making Facebook its largest minority shareholder.”
In a separate statement, Reliance said that the investment by Facebook values Jio Platforms at Rs 4.62 lakh crore pre-money enterprise value (USD 65.95 billion, assuming a conversion rate of Rs 70 to a US dollar).
“Facebook’s investment will translate into a 9.99 percent equity stake in Jio Platforms on a fully diluted basis,” it said.
Reliance Jio Infocomm Ltd, with about 400 million subscribers, is a wholly-owned subsidiary of Jio Platforms. The latest deal is a win-win for both Facebook and Jio as this would give Facebook deeper access to India which is the second-largest internet market after China.
Facebook also has more than 400 million active WhatsApp users in India and is now planning to launch a payment service for a very long time. In this matter having a local partner could help it in navigating various regulatory issues, including those related to privacy and local storage, and also having a good telecom partner in hand could help Facebook improve its reach to masses.
RIL Chairman and MD Mukesh Ambani said, “when Reliance launched Jio in 2016, we were driven by the dream of India’s Digital Sarvodaya – India’s Inclusive Digital Rise to improve the quality of life of every single Indian and to propel India as the world’s leading Digital Society”.
The synergy between Jio and Facebook will help realize the goal of ‘Digital India’, he also added. “In the post-corona era, I am confident of India’s economic recovery and resurgence in the shortest period of time,” he added.