Shares of Reliance Industries Ltd jumped over 8% on Wednesday to a near seven-week high after Facebook announced it will invest $5.7 billion (Rs 43,574 crore) to buy a 10% stake in Jio Platforms.
The scrip advanced 8.34% to Rs 1,339.20 on the BSE Sensex and 8.27% to Rs 1,339.70 on the NSE Nifty. It was the top gainer on both the 30-share BSE Sensex and NSE Nifty-50 in morning trade.
The company’s market valuation also jumped by Rs 45,527.62 crore to Rs 8,29,084.62 crore.
Facebook’s investment will make it the largest minority shareholder in billionaire Mukesh Ambani’s telecom arm Jio Platforms Ltd, Jio said in a statement on Wednesday, putting the enterprise value of the business at around $66 billion.
Jio Platforms is a wholly-owned subsidiary of Reliance Industries Ltd and houses the digital services of the group. Reliance Jio Infocomm is a wholly-owned subsidiary of Jio Platforms.
“Today we are announcing a USD 5.7 billion, or Rs 43,574 crore, investment in Jio Platforms Ltd, part of Reliance Industries Ltd, making Facebook its largest minority shareholder,” the US company said in a statement.
“Facebook’s investment will translate into a 9.99 per cent equity stake in Jio Platforms on a fully diluted basis,” Reliance said in a separate statement.
The deal will help the US social media giant leverage WhatsApp to partner with Reliance’s e-commerce marketplace JioMart, that connects small businesses to customers.
“(India) is in the middle of a major digital transformation and organizations like Jio have played a big part in getting hundreds of millions of Indian people and small businesses online,” Facebook’s Mark Zuckerberg said in a post.
For Reliance, whose debt pile swelled to more than $40 billion as of September, the partnership will bring in much needed funds to make good on its promise to cut net debt to zero by March 2021.
Stocks also rose on Wednesday, lifted by an 8% surge in Reliance Industries Ltd. The NSE Nifty 50 index climbed 1.13% to 9,082.9 by 0557 GMT, while the benchmark S&P BSE Sensex gained 1.43% to 31,071.01.
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