Google to Invest $4.5 Billion in India's Jio Platforms -- Update
By Ben Otto and Eric Bellman
Alphabet Inc.'s Google will invest about $4.5 billion in Jio
Platforms Ltd, the company behind India's largest telecom provider
by subscribers, giving the American tech giant a powerful partner
for its plans to get hundreds of millions more people online.
Google will take a 7.7% stake in Jio, which brought the internet
to millions of people who previously couldn't afford it by offering
inexpensive handsets and data plans. It now has more than 388
Mukesh Ambani, chairman of Jio's parent company, Reliance
Industries Ltd., and India's richest man, announced the deal at a
Reliance shareholder meeting Wednesday.
"Google has empowered millions of Indians to access helpful
information and, like Jio, is a force for change and innovation,"
Mr. Ambani said. "We welcome Google onboard and are excited about
our partnership for what it can deliver to Indians."
Jio and Google also announced that they will work together to
develop affordable smartphones.
The tie-up provides Jio with cash and another sophisticated
international partner. In return, Google will get a powerful local
ally. Reliance Industries has interests ranging from retail to
refining, and is known for its understanding of regulators and
Jio has raised billions of dollars from leading technology and
private-equity firms around the world this year. The investment by
Google follows others by companies including Facebook Inc., Silver
Lake, Vista Equity Partners, KKR & Co., General Atlantic LLC,
the Abu Dhabi Investment Authority, sovereign investor Mubadala
Investment Co. and Qualcomm Ventures.
Reliance has spent more than $30 billion building upstart mobile
operator Reliance Jio Infocomm Ltd., which is part of Jio
Platforms. Jio is now moving into e-commerce, as legions of people
in the country of 1.3 billion begin transacting online for the
Just this week Google announced it was creating a $10 billion
fund to invest in Indian tech companies, partnerships and
infrastructure. The Jio deal will be the first investment from that
Many analysts and executives consider India one of the last
great untapped digital markets. While expansion in most big markets
has slowed, India will be adding around 171 million new wireless
internet subscribers in the next five years, according to estimates
from GSMA Intelligence. That is twice the number expected to be
added in China and the U.S. combined.
Alphabet's investment in Jio puts Google in a better position to
profit from the Indian market, as more internet users come online
and incomes rise.
"Our joint collaboration will focus on increasing access for
hundreds of millions of Indians who don't currently own a
smartphone while improving the mobile experience for all," Sundar
Pichai, CEO of Google and Alphabet, said in a news release
Write to Ben Otto at firstname.lastname@example.org and Eric Bellman at
(END) Dow Jones Newswires
July 15, 2020 08:30 ET (12:30 GMT)
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