Facebook Jio Deal, Facebook Agrees to invest $5.7 billion
Facebook to tie-up with Jio, Agrees to invest $5.7 billion.
The Jio-Facebook tie-up is being considered as an iconic deal between two of the world’s richest companies. Facebook, on Wednesday, as part of strategic investment, has agreed to spend $5.7 billion i.e. Rs 43,574 crore for a 9.99% stake in Jio Platforms, a subsidiary of Reliance Industries Limited. Along with 4G networking, it includes services like streaming music and movies, shopping online, news app, etc.
Currently, Jio has 388 million subscribers and about 700 million people. Moreover, they use the three FB platforms namely Facebook, Instagram, and WhatsApp in India. Together they have the potential to make other players in e-commerce and payments lag behind. These players include Amazon, Flipkart, and Google.
In his recent FB post, Mark Zuckerberg stated that India has more than 60 million small businesses. Also, they are teaming up with Jio to help them create new opportunities by providing digital tools. Furthermore, in a video message, Ambani pointed towards the tie-up between JioMart and Whatsapp. He further told that it will be empowering nearly 30 million small Indian shops.
“This means all of you can order and get faster delivery of day-to-day items from nearby local shops,” he said. However, this collaboration doesn’t mean that the two will not compete in the market. “The entities are independent of each other in every respect,” said Anshuman Thakur. He is the head of the strategy, Reliance Jio. He further stated that the deal does not change business models for the companies.
Moreover, this transaction will provide relief to the $ 43 billion debt of RIL. It is expected that Jio Platforms will retain $2.14 billion and the rest will provide to its parent company. Closing of the deal was initially decided on March 31 but the ongoing pandemic delayed it till now.
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