Google (GOOGL) will inject $ 4.5 billion into Mukesh Ambani’s Jio Platforms, the digital technology arm of expanding conglomerate Industries Reliance. That gives Google a 7.7% stake in the company, the companies announced Wednesday.
The investment includes an agreement to jointly develop an affordable entry-level smartphone and “expand the benefits of digitization across India,” they said. The deal values Jio at around $ 58 billion.
Jio Platforms includes the largest mobile network in India with over 388 million subscribers. Jio also has an app ecosystem, offering smartphone users everything from online shopping to digital payments and video streaming.
The company has been in a hectic wave of fundraising in recent months. Including Google’s investment, Jio has accumulated approximately $ 20 billion since April from investors including Qualcomm (QCOM), Intel (INTC), KKR, Silver Lake, Vista and Mubadala, the sovereign wealth fund of Abu Dhabi. Facebook (full board) invested $ 5.7 billion for a 9.99% stake.
Wednesday’s announcement comes two days after Google CEO Sundar Pichai announced plans to invest $ 10 billion in India with the goal of making the Internet “affordable and useful” for a billion people.
It was not immediately clear if Google’s investment in Jio Platforms was part of that total, but the Silicon Valley firm said earlier this week that its investment would involve capital investments, partnerships, and infrastructure spending over the next five to seven years.
India is the fastest growing Internet market in the world, with almost 700 million Internet users and almost the same number. Not yet online for the first time. The country has attracted billions of dollars of investment in the last 15 years not only from Google and Facebook, but also from Amazon (AMZN), Netflix (NFLX)and Twitter (TWTR), which was quick to take advantage of the Internet boom.
The numbers suggest that there is still enormous growth potential, despite the red flags recently raised by government efforts. Exercise more control online and India’s economic downturn. Google’s plans, coupled with Ambani’s wave of fundraising, show investors they are ready to commit themselves even more.
China dominates India’s smartphone market and tech giants Alibaba (SLIME) and Tencent (TCEHY) They are important investors in some of the most valuable startups in the country. But tension has grown between close trading partners and neighbors, and India last month banned several Chinese apps, including TikTok, claiming they pose a threat to national security.
– Sherisse Pham and Hanna Ziady contributed to this report.
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