Facebook Buys 9.99% Stake In Jio; Largest Investment For Minority Stake

|

Facebook announced on Wednesday that it will invest Rs. 43,574 crore to buy its 9.99 percent stake in Reliance Jio. This acquisition will help the US-based social media giant to expand its reach in the Indian market. Besides, the investment will allow Reliance Jio to reduce its debt.

Facebook Buys 9.99% Stake In Jio

 

"Reliance Industries Limited, Jio Platforms Limited, and Facebook today announced the signing of binding agreements for an investment of Rs 43,574 crore by Facebook into Jio Platforms," RIL said.

While announcing the deal, RIL said that this is the largest foreign direct investment by any company for picking up a minority stake in the Indian technology firm. The firm intimated that this investment will help Jio platforms to increase their value and position in India.

"This investment by Facebook values Jio Platforms at Rs 4.62 lakh crore pre-money enterprise values ($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," RIL added.

It is worth mentioning that the main reason behind this partnership is to launch a digital platform for micro, small, and medium businesses in India. Apart from that, Whatapp which is owned by Facebook has joined hands with Reliance Jio and Jio Platform to speed up the commerce business on JioMart.

Under this partnership, JioMart, which is the company's e-commerce platform and WhatApp will help 3 crore small Kirana shops. This means that customers will get everything from local shops by using the platform.

In a separate statement, Facebook said, "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."

 

This is not the first time Reliance Industries has tried selling its stake to a foreign entity. Earlier, the company was in talks with Saudi Aramco for selling its 20 percent stake in its oil and chemical business.

The main reason behind selling its stake to other companies is to become a debt-free company by March 2021, and if we talk about this deal then this will help Facebook to attract users towards its payment services as Reliance Jio is serving 388 million customers in India. For the unaware, Facebook has recently launched its payment service in the country. However, it is facing tough competition with other apps such as Amazon Pay, Paytm, and Phonepe.

Most Read Articles
Best Mobiles in India

Read More About: facebook reliance jio

Best Phones

Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Yes No
Settings X
X