Google pays Rs 33,737 Cr for 7.73 pc stake in Jio Platforms
Alphabet Inc's Google has paid Rs 33,737 crore for a 7.73 percent stake in Reliance Industries Ltd's (RIL) digital subsidiary, Jio Platforms Ltd, joining the list of global investors such as Facebook, billionnaire Mukesh Ambani's firm said.
The transaction also marks the US technology giant's biggest-ever investment in an Indian company.
With this, Jio Platforms has raised a total of Rs 1.52 lakh crore by selling nearly 33 percent stake to 13 financial and strategic investors in just 11 weeks. This has helped RIL erase its net debt much ahead of the March 2021 target.
"After receipt of all requisite approvals, Jio Platforms, a subsidiary of the company, received the subscription amount of Rs 33,737 crore from Google International LLC (a wholly owned subsidiary of Google LLC)," RIL said in a stock exchange filing.
Jio Platforms has allotted equity shares to Google International LLC, following which Google International LLC holds 7.73 percent of the fully diluted equity share capital of Jio Platforms Limited, it said.
Google and Jio Platforms will also collaborate to develop "an entry-level affordable smartphone with optimisations to the Android operating system and the Play Store", the two companies had said in July.
Leveraging existing digital services
Jio Platforms houses India's youngest but largest telecom service provider Jio with more than 400 million users. It also houses the digital assets of RIL, including broadband connectivity, cloud and edge computing, big data analytics, and artificial intelligence.
The Google-Jio deal will seek to leverage Jio and Google's existing digital services to capture the emerging digitisation market beyond the current 500 million internet users in India.
Earlier this month, the Competition Commission of India (CCI) said it had approved internet major Google's proposed purchase of 7.73 percent stake in Jio Platforms.
In July, it was announced that Google has agreed to invest Rs 33,737 crore to buy a 7.7 percent stake in the Reliance Industries' technology venture.
(Disclaimer: Additional background information has been added to this PTI copy for context)