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Home >News >India >Facebook to invest 43,574 crore for 10% in Jio Platforms

NEW DELHI: Facebook will invest 43,574 crore for a 9.99% stake on a fully diluted basis in Jio Platforms, a wholly-owned subsidiary of Reliance Industries Ltd. The deal gives the mobile communications, entertainment and e-commerce platform a pre-enterprise value of 4.62 trillion, assuming a conversion rate of 70. The rupee is currently hovering between 76 and 77 against the US dollar. Facebook will become the largest minority shareholder of Jio after the deal has got its regulatory approvals.

India with its over one billion mobile user base is also the largest market for Facebook and its messaging app Whatsapp, that has over 400 million subscribers in the country.

Reliance Jio Infocomm Limited, which provides connectivity platform to over 388 million subscribers, will continue to be a wholly-owned subsidiary of Jio Platforms. Jio was launched in September 2016 and in just over three years, became India’s largest mobile services company by subscriber base. It is the only Indian telecom company that has its entire network built on 4G VoLTE (voice over long-term evolution) technology. All other companies have a blend of 2G, 3G and 4G technologies.

“The synergy between Jio and Facebook will help realise Prime Minister Shri Narendra Modi’s ‘Digital India’ Mission with its two ambitious goals — ‘Ease of Living’ and ‘Ease of Doing Business’ – for every single category of Indian people without exception. In the post-Corona era, I am confident of India’s economic recovery and resurgence in the shortest period of time. The partnership will surely make an important contribution to this transformation," an RIL press release quoted its Chairman and Managing Director Mukesh Ambani as saying.

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. The investment values Jio Platforms amongst the top 5 listed companies in India by market capitalization.

“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," David Fischer, Facebook’s Chief Revenue Officer and Ajit Mohan, Vice President and Managing Director of the company’s India unit said in a joint blog post.

Jio can be credited with bringing data to the poorest of Indians at costs lowest in the world. Before its launch, 1GB of data easily cost Indians upwards of 100. The same data is available today at less than one-tenth of the cost. That has propelled Indians to the league of highest data consumers in the world with mobile streaming of entertainment, news, sports and games replacing traditional delivery platforms.

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