Facebook buys 9.9 pct stake in Reliance Jio for Rs 43,574 crore, turns largest minority shareholder
Facebook on Wednesday announced that it is buying 9.9 per cent stake in the firm that houses billionaire Mukesh Ambani's telecom arm Jio.
Facebook on Wednesday announced that it is buying 9.9 per cent stake in the firm that houses billionaire Mukesh Ambani's telecom arm Jio. The social media giant is looking to expand presence in its largest market in terms of subscriber base. As part of the deal, Facebook will be spending $5.7 billion or Rs 43,574 crore.
"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," the company said in a statement.
Reliance in a separate statement said 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 per cent equity stake in Jio Platforms on a fully diluted basis," it said.
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Jio Platforms, a wholly-owned subsidiary of Reliance Industries Ltd (RIL), houses digital services of the group. Reliance Jio Infocomm Ltd, with 388 million subscribers, is a wholly-owned subsidiary of Jio Platforms.
The deal allows RIL to cut debts. The company has been seeking strategic partnerships across its businesses while targeting to deleverage its balance sheet. It has been talking to Saudi Aramco for sale of a 20 per cent stake in its oil-to-chemical business for an asking of $15 billion. RIL has already tied up with BP Plc for fuel business as it targets to have a debt-free status by next year.
"The partnership between Facebook and Jio is unprecedented in many ways. 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," RIL said.
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