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“Reliance Industries Limited (” Reliance Industries “), Jio Platforms Limited (” Jio Platforms “) and Facebook, Inc. (” Facebook “) today announced the signing of binding agreements for an investment of Rs 43,574 million by Facebook in Jio Platforms, “The RIL led by Mukesh Ambani said in a statement on Wednesday.
“This Facebook investment values Jio platforms at Rs 4.62 lakh crore of pre-money business value ($ 65.95 billion, assuming a conversion rate of Rs 70 to one US dollar). Facebook’s investment will translate into a share of the 9.99% in Jio Platforms on a fully diluted basis, “added the oil business house to telecommunications.
Reliance Jio, the telecommunications unit with 388 million subscribers, will remain a wholly owned subsidiary of Reliance Platform.
“… In the post-Crown era, I am confident in India’s economic recovery and revival in the shortest period of time. The association will surely make a significant contribution to this transformation,” said Mukesh Ambani, president and MD of RIL, in the statement.
In a separate statement, Facebook said the deal underscores its commitment to India. India is the largest market for Facebook with 328 million monthly users and the company’s WhatsApp messaging app has 400 million users in the country, also the most in the world.
“… Our efforts with Jio will focus on opening new doors and driving India’s economic growth and prosperity for its people. We look forward to working with Jio and future collaborations in India to advance this vision,” Facebook said.
“… In less than four years, Jio has connected more than 388 million people online, driving the creation of innovative new companies and connecting people in new ways. We are committed to connecting more people in India together with Jio, ”added Facebook.
The main objective of the agreement is to find digital solutions for 60 million micro, small and medium-sized companies, 120 million farmers, 30 million small merchants and millions of small and medium-sized companies in the informal sector.
Simultaneously with the investment, Jio Platforms, Reliance Retail and WhatsApp have also signed a trade association agreement to further accelerate the new Reliance Retail business on the JioMart platform using WhatsApp and to support small businesses on WhatsApp.
The business house said this was the largest investment for a minority stake of a technology company anywhere in the world and the largest FDI in the technology sector in India.
“Our goal is to enable new opportunities for companies of all sizes, but especially for the more than 60 million small businesses across India. They represent the majority of jobs in the country and form the heart and soul of rural and urban communities alike. In the face of the coronavirus, it is important that we both combat this global pandemic now and lay the groundwork to help people and businesses for years to come, “Facebook said.
He added that the purpose of the link will be to create new ways for people and companies to operate more effectively in the growing digital economy. “For example, by uniting JioMart, Jio’s small business initiative, powered by WhatsApp, we can enable people to connect with businesses, buy, and ultimately buy products in a seamless mobile experience.”
Morgan Stanley as financial advisor and AZB & Partners and Davis Polk & Wardwell as advised advisers on the transaction.
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