Facebook To Acquire 9.9% Stake In Jio Platforms Via New Entity Jaadhu Holdings
Facebook Inc. will complete its acquisition of 9.9% stake in Jio Platforms via a new entity Jaadhu Holdings LLC, according to regulatory documents.
In April, the Mark Zuckerberg-controlled firm said it will invest $5.7 billion, or Rs 43,574 crore, in the digital and telecom assets controlled by Mukesh Ambani as the U.S.-based social networking giant plans to expand footprint in its biggest global market.
Following this deal, high-profile private equity investors—from KKR & Co. to General Atlantic—picked up stake in Jio Platforms, boosting the company’s valuation ahead of a potential overseas listing. On Tuesday, Bloomberg News reported that Jio Platforms is nearing a deal with top middle-eastern sovereign funds. Reliance Industries Ltd. aims to be debt-free by the end of 2020-21.
According to a submission made to the Competition Commission of India, Jaadhu Holdings LLC is an indirect, wholly owned subsidiary of Facebook Inc. "Jaadhu is a newly incorporated company formed in March 2020 under the laws of the State of Delaware, US.... Jaadhu is not engaged in any business in India or anywhere in the world," it said.
The notification form is being filed in relation to Jaadhu Holdings' proposed acquisition of a minority, non-controlling shareholding of approximately 9.99% of the fully diluted equity share capital in Jio Platforms, it added.
Simultaneously, Jio Platforms, WhatsApp Inc. and Reliance Retail Ltd. are proposing to enter into a separate commercial arrangement, it added.
Reliance Retail’s JioMart, a new commerce marketplace that connects customers with Kirana stores and other small and microlocal Indian businesses, plans to integrate certain WhatsApp services with JioMart.
The submission noted that the proposed transaction does not alter the competitive landscape in any potential market, and that Facebook and Jio Platforms will continue to operate independently. "The proposed transaction and the proposed commercial arrangement are pro-competitive, beneficial for consumers, Kirana stores and other small and micro local Indian businesses, and takes forward the vision of digital India.”
On Wednesday, RIL shares rose 0.41% to Rs 1,542.45 apiece on the BSE while the benchmark Sensex gained 0.84% to end the day at 34,109.54 points.