Mark Zuckerberg, the founder of the largest social media platform Facebook, has revealed that they are going to invest in Reliance Jio which is an Indian telecommunications company and a wholly-owned subsidiary of Reliance Industries. The investment amount sums to $5.7 Billion or Rs.43,574 crore for a 9.99% stake.
Both companies in separate statements mentioned that they will work together on some major projects that will open up commerce opportunities for people across India. Zuckerberg said India is the home to the largest communities on Facebook and WhatsApp and where Jio has played a big part in the digital revolution which is going in India.
Mark Zuckerberg mentioned in his Facebook post why they are partnering with the Reliance Jio group and investing in that particular telecom business. The post is here.
“Reliance Industries Limited, Jio Platforms Limited and Facebook, Inc. today announced the signing of binding agreements for an investment of Rs43,574 crore by Facebook into Jio Platforms,” RIL said in a statement today.
“This investment by Facebook values Jio Platforms at Rs4.62 lakh crore pre-money enterprise value ($65.95 billion, assuming a conversion rate of Rs70 to a US Dollar). Facebook’s investment will translate into a 9.99% equity stake in Jio Platforms on a fully diluted basis,” they also added.
Mukesh Ambani, Chairman of Reliance Industries Limited, said in a video “Our goal is to enable new opportunities for businesses of all sizes, but especially for the more than 60 million small businesses across India. They account for the majority of jobs in the country and form the heart and soul of rural and urban communities alike.”
He also added, “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 in the years to come,”
Mr. Ambani’s Reliance Industries is also set to sell a fifth of its oil and chemical refining business to Saudi Aramco for roughly $15 billion (roughly Rs. 1.15 lakh crores), and a stake in its telecom tower assets to Canadian private equity firm Brookfield Asset Management for over $3 Billion (roughly Rs. 23,000 crores).
For Reliance, whose debt pile swelled to more than $40 billion as of September, the partnership will bring in much-needed funds to make good on its promise to cut net debt to zero by March 2021.