Updated: June 25, 2020 8:03:36 am
The Competition Commission of India (CCI) on Wednesday approved Facebook Inc’s 9.99 per cent stake buy in Reliance Industries’ (RIL) Jio Platforms. Facebook will buy stake worth Rs 43,574 crore in Jio Platforms through a wholly-owned indirect subsidiary Jaadhu Holdings LLC.
Jaadhu Holdings was incorporated in March 2020 in Delaware, US and was not engaged in any business in India or anywhere in the world, according to the submissions it had made to the CCI.
Facebook’s minority non-controlling stake buy on April 22 was one of the first deals for Jio Platforms. The latter has since then raised Rs 1.15 lakh crore by selling small stakes to about 11 private equity and sovereign funds across the world. The latest to invest in Jio Platforms was Saudi Arabia’s Public Investment Fund, which had bought a 2.32 per cent stake for Rs 11,367 crore.
The deals have pushed RIL ahead on its plans to de-leverage its balance sheet while accelerating the launch of its new e-commerce business. Experts have also said the arrangement among Reliance Retail, Jio Platforms and Facebook-owned WhatsApp to offer consumers the ability to access the nearest kiranas, or grocery stores, which can provide products and services to their homes by transacting with JioMart using WhatsApp has come at a very opportune time.
WhatsApp boasts of 400 million users in India. Further, using WhatsApp’s base also allows Reliance Retail to promote its services to users of Jio’s rival telecom players.
The deal, now approved by CCI, also marks Facebook’s entry among elite investors in India’s technology space, joining the likes of SoftBank, Amazon and Google that have together poured in billions of dollars in Indian tech startups and their own ventures over the years.
Prior to Jio Platforms, Facebook had invested around $20-25 million in social commerce platform Meesho in 2019, and participated in a $110 million funding round for edu-tech company Unacademy earlier this year.
📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines