The social media giant Facebook has bought a 9.9% stake in Reliance Jio for $5.7 billion (Rs 43,574 crore), the telecom unit of Reliance Industries Ltd (RIL). The deal values Jio at Rs 4.62 lakh crore ($65.95 billion). The deal is likely to give Facebook a firm foothold in the Indian market and helps the Indian oil-to-telecom conglomerate to significantly cut its debt.
RIL said in a statement that this is the largest investment for a minority stake by a technology company anywhere in the world and the largest FDI in the technology sector in India. The investment values Jio Platforms amongst the top 5 listed companies in India by market capitalization, within just three and a half years of the launch of commercial services.
“This investment underscores our commitment to India and our excitement for the dramatic transformation that Jio has spurred in the country. In less than four years, Jio has brought more than 388 million people online, fueling the creation of innovative new enterprises and connecting people in new ways. We are committed to connecting more people in India together with Jio,” said Facebook.
With this, Reliance Retail and Facebook’s WhatsApp service have also entered into a commercial partnership on JioMart platform using WhatsApp and to target small businesses on WhatsApp.
Since it launch in 2016, Jio has accumulated around 340 million customers. Mukesh Ambani, chairman and managing director, RIL, invested around $40 billion to launch Jio. The deal is expected to help reduce RIL’s debt burden, which swelled due to the aggressive expansion of Jio and other businesses.
“All of us at Reliance are humbled by the opportunity to welcome Facebook as our long-term partner in continuing to grow and transform the digital ecosystem of India for the benefit of all Indians,” said Ambani.