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Google invests Rs 33,737 crore in Jio
Proceeds from the stake sales in Jio Platforms, along with the Rs53,124 crore raised in a rights issue in June and sale of a 49 per cent stake in its fuel retail network to BP last summer for `7,629 crore will help the company become net debt-free
- Mukesh Ambani, Chairman, RIL
Mukesh Ambani says Google, Jio will develop affordable smartphones; addresses 1st ever RIL's online AGM
Mumbai: Google has agreed to invest Rs 33,737 crore for a 7.7 per cent stake in Reliance Industries' technology venture and to cooperate on technology initiatives, including development of affordable smartphones, billionaire Mukesh Ambani said on Wednesday.
Addressing RIL's first-ever online annual general meeting, which had an unprecedented 3.2 lakh shareholders attending from 550 cities in 48 countries through the newly-minted JioMeet platform, he said Reliance Jio has developed an indigenous 5G solution which can be exported globally.
Also, the group's petrochemical and retail business has received strong interest from financial and strategic investors on lines of the massive Rs 1.52 lakh crore that the technology venture Jio Platforms amassed in less than three months from the likes of Facebook and Google.
The only disappointment for investors was on the company's talks for a sale of a 20 per cent stake in oil-to-chemical (O2C) business to Saudi Aramco for an asking of $15 billion, with Ambani saying talks have 'not progressed as per the original timeline'.
He, however, hastened to add that the company has raised enough money from stake sale in Jio Platforms and fuel retailing business as well as a rights issue to achieve the net-debt free target nine months ahead of schedule.
Achieving net-debt free status was one of the objectives behind Asia's richest man announcing stake sale talks on O2C business to Aramco in the company's last annual general meeting in August 2019.
On Wednesday, he neither said if the talks with Aramco were on track nor did he give a new deadline. All he said was that RIL, operator of the world's largest refining complex, will replace transportation auto fuels with clean electricity and hydrogen as it set a target to become net carbon-zero by 2035.
"We are delighted to welcome Google as a strategic investor in Jio Platforms. We have signed a binding partnership and an investment agreement under which Google will invest Rs 33,737 crores for a 7.7 per cent stake in Jio Platforms," Ambani, 63, said.
California-based Alphabet Inc joins Facebook Inc, which opened the investment cycle in Jio Platforms by picking 9.99 per cent stake for Rs 43,573.62 crore, as well as chipmaker Intel Corp and Qualcomm Inc. With Google coming on board, Reliance has completed its target of capital raising for Jio Platforms, he said.
With this deal, Reliance has sold 32.84 per cent stake in Jio Platforms Ltd - the unit that houses India's youngest but largest telecom firm Jio Infocomm and apps, to 13 marquee firms for a total of Rs 1,52,055.45 crore.
Proceeds from the stake sales in Jio Platforms, along with the Rs 53,124 crore raised in a rights issue in June and sale of a 49 per cent stake in its fuel retail network to BP last summer for Rs 7,629 crore will help the company become net debt-free, Ambani said.
The cumulative fund raising by Reliance in less than three months is now Rs 2,12,809 crore as compared to net debt of Rs 1,61,035 crore as on March 31, 2020.
Ambani, who has catapulted his way to become the sixth richest man in the world with $72.4 billion, surpassing Tesla's Elon Musk and Alphabet co-founders Sergey Brin and Larry Page, said his group can 'design entry-level 4G or even 5G smartphone for a fraction of its current cost'. As many as 350 million Indians still use a 2G feature phone.
