Mumbai 15th July 2020: Google acquired a 7.7 percent stake of India’s leading online company Jio platforms for $4.5 billion, adding to a series of large U.S. investments into an India based online venture that has nearly 400 million users in India.
The global search leader is acquiring 7.7% of the fast-growing internet unit for 337.4 billion rupees, Reliance Chairman Mukesh Ambani said in a Reliance AGM event.
Google, whose Android software runs on most smartphones, will help Jio create an entry-level, affordable mobile device, he added.
Google joins rival Facebook Inc., which recently invested $5.7 billion toward a 9% stake of Jio. Total 14 investment came in Reliance Jio in the last two months which includes chipmakers Intel Corp. and Qualcomm Inc etc.
Jio is a highly preferred investment for US companies because it has maximum online Indian users, and China’s no entry sign for American companies.
“Digital revolution marks the greatest transformation in the history of mankind,” Ambani told shareholders at Reliance’s annual general meeting. “India must lead the change to create a better world. This is Jio’s purpose.”
With Google’s Investment Reliance Jio attracted somewhere close to $20 billion of funding. The Reliance share price was up 3% before the closing of the market.
Global tech leaders are looking for multiple ways to grab a slice of the Indian market, where millions of first-time internet users are added every month. Jio Platforms offers the largest base of such users who are increasingly buying consumer goods online and downloading music and video, using cheap smartphones and Jio’s own cut-price data services.
In the case of Google, this investment will help the company’s future strategy in cloud computing, smartphone operating system, and the company’s mobile payments push in India.