Mukesh Ambani led Jio recieved an investment of Rs 43,574Crore (USD 5.7 Billion) on Wednesay, from Marc Zuckerberg's Facebook. This investment will translate into a 9.99% minority shareholding in Jio Platforms, which will make the US Social Media giant the largest minority shareholder in Jio.
Jio Platforms, which will become the holding company of Reliance Jio Infocomm, was valued at USD 65.95 Billion by Facebook (USD 1 = Rs 70).
"Over the past few years, Facebook, WhatsApp and Instagram have become household names in India. WhatsApp, in particular, has entered our people's daily vocabulary in all the 23 official languages of India. WhatsApp is not just a digital application, it has become aapka, aur hum sabka, pyaara dost," - Mukesh Ambani
This deal, which is being talked about as the India-US effort on commanding the social media space globally, will allow the US based social media giant and owner of the highly popular WhatsApp (with 400 million users in India) to leverage on this market and offer digital payment services through WhatsApp.
"India is home to the largest communities on Facebook and WhatsApp, and a lot of talented entrepreneurs. The country is in the middle of a major digital transformation and organisations like Jio have played a big part in getting hundreds of millions of Indian people and small businesses online," - Zuckerberg
The deal will also allow Reiance to cut its piling debt as it pushed Jio with unprecedented aggression in India, to make it the top player in the telecom business in India in such a short while.
How does this deal augur for Indian commerce, Reliance and Facebook.
- Zuckerberg said that India is in the middle of a major digital transformation, especially in the post Covid times. He added that leveraging the WhatsApp and FB platforms, the company is committed to opening up commerce opportunities for people across the country.
- Focus on collaborations between WhatsApp and JioMart to connect small businesses to consumers. India is WhatsApp biggest market with 400 million users. Jio is the top player in the Indian telecom market.
- Reliance retail has over 10,000 stores selling apparel, consumer electronics and groceries. Reliance retail and Jio saw 25% spurge in revenue by December.
- Government has approved WhatsApp Digital Payment services, which will make it compete with the likes of Google Pay and PayTM
"With communities around the world in lockdown, many of these entrepreneurs need digital tools they can rely on to find and communicate with customers and grow their businesses. This is something we can help with -- and that's why we're partnering with Jio to help people and businesses in India create new opportunities," - Zuckerberg
- India has 60 million small businesses. Core of the Indian economy depends on them and millions are provided livelihood from these businesses.
- In the wake of severe disruptions caused by Coronavirus, comprehensive digitisation will be an absolute necessity for revitalisation of the Indian economy.
- Jio and FB will work closely to ensure that the millions of Kirana stores across the country can be accessed seamlessly by consumers using JioMart and WhatsApp.
- Jio Platforms, Reliance Retail and WhatsApp have also entered into a commercial partnership agreement to further accelerate Reliance Retail's New Commerce business on the JioMart platform using WhatsApp to support small businesses on WhatsApp.
Input Source: Media Reports, PTI, Reuters