Facebook buys 9.9% stake in Reliance Jio: Why it is a win-win deal for both; key highlights of $5.7 billion deal
Facebook makes 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, Reliance Industries Limited (RIL) said in a statement.
On 22 April, social media giant Facebook announced an investment of $5.7 billion (Rs 43,574 crore) to buy a 9.9 percent stake in the firm that houses billionaire Mukesh Ambani's telecom arm Jio, Mark Zuckerberg-led Facebook looks to expand presence in India - its largest market in terms of subscriber base.
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, Reliance Industries Limited (RIL) said in a statement.
The investment values Jio Platforms amongst the top 5 listed companies in India by market capitalization, within just three and a half years of launch of commercial services, said RIL.
On the deal announcement, Facebook said: This investment underscores our commitment to India, and our excitement for the dramatic transformation that Jio has spurred in the country. Our goal is to enable new opportunities for businesses of all sizes, but especially for the more than 60 million small businesses across India.
Concurrent with the investment, Jio Platforms, Reliance Retail and Facebook's WhatsApp service have also entered into a commercial partnership agreement to further accelerate Reliance Retail’s new commerce business on the JioMart platform using WhatsApp.
The latest deal is a win-win for both Facebook and Jio. It would give Facebook deeper access to India, the second-largest internet market after China.
The deal will help reduce RIL’s debt burden, which bulged due to the breakneck expansion of Jio and other businesses.
(Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd which publishes Firstpost)
Reliance Jio emerged as the top bidder in the recently concluded 5G spectrum auction. The service provider bought frequency bands worth Rs 88,078 crore. All in all, about 51.236GHz worth of frequency bands were auctioned for Rs 1.5 lakh crore.
In all, bids worth Rs 1.5 lakh crore were received, Telecom Minister Ashwini Vaishnaw said. He added that 5G services could be launched by October