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The world’s largest social media company Facebook may buy a 10 per cent stake in Reliance Jio, India’s largest telecom company. A Financial Times report claimed. The report said that Reliance Industries Limited wants to make its telecom service arm Jio debt free by 31 March 2020. That is why this deal is being done. The report said that the deal would be worth thousands of crores of rupees. According to analyst firm Bernstein, Reliance Jio is a company valued at $ 20 billion, or about Rs 4.5 lakh crore. However, Facebook and Reliance Jio have not responded in this regard. The report said that the deal could be delayed due to the lockdown in India due to coronavirus.
How Much Can be The Deal
The deal could be worth billions of dollars. Reliance Jio has a base of about 37 crore customers in India. Analyst Bernstein has valued the company at around $ 60 billion, which means that its 10 percent stake can be traded for about $ 6 billion.
According to the news, the conversation about this between Reliance and Facebook had gone much further, but due to the ban on worldwide travel due to the outbreak of Corona virus, it has become a bottleneck. Facebook will enter the telecom and digital sectors of India through this deal. Significantly, Jio is active in many segments like mobile telecom, home broadband, e-commerce.
Reliance Jio is The Country’s Largest Telecom Company
Reliance Jio is the largest telecom company in the country in terms of customers. As of December 2019, Reliance Jio had 37 crore subscribers as per the latest TRAI data. Vodafone-Idea was the second largest telecom company in December with 332 million subscribers. Bharti Airtel was the third largest company with 32.72 crore subscribers in December 2019. According to TRAI, the state telecom company BSNL had 11.8 crore and MTNL had 33.76 lakh subscribers in this month.
Reliance Formed New Subsidiary in October
In October last year, Reliance announced the formation of a new subsidiary to bring all its digital initiatives and apps under a single entity. Reliance had invested 1.08 lakh crore rupees in this new company. Jio apps like Jio TV, Jio Cinema, Jio News etc. were brought under this new company. It also simplified the structure for potential strategic investors. On March 18, Reliance Industries transferred some of the debt of Reliance Jio to itself. However, the amount of this loan was not disclosed. Facebook May Buy 10 Percent Stake in Reliance Jio.
Facebook Aims to Have 34 Million Active Users by 2020
Veteran social media company Facebook has set a target of creating 34 million monthly active users in India by 2020. According to Statista.com, Facebook had more than 28 crore monthly active users in 2018. Facebook is headquartered in California, USA and also operates platforms such as Instagram, Messenger, WhatsApp, Watch, Portal, Oculus, Calibra. Facebook’s total revenue in 2019 was $ 70.697 billion.
Such is The Business of Live
The functioning of Reliance Jio started in September 2016. This started a price war in the Indian telecom sector as soon as it arrived. The company provides data and voice services at very low rates. At present, the telecom sector of India is being destroyed due to the problem of AGR, but Reliance Jio rests strongly. However, the company wants to eliminate its debt and bring it down to zero, so the company is probably trying to sell the stake. Facebook May Buy 10 Percent Stake in Reliance Jio.