The social network has invested $ 5.7 billion in Jio Platforms Limited, owned by Reliance Industries, led by billionaire Mukesh Ambani.
Jio Platforms has several brands, including its telecommunications company Reliance Jio, which has grown rapidly thanks to competitive prices to become the leading mobile operator in India in terms of revenue and subscribers.
“This investment underscores our commitment to India and our enthusiasm for the dramatic transformation that Jio has brought about in the country,” Facebook said in a blog on Tuesday.
The investment gives Facebook a 9.99% stake in Jio Platforms and gives it a pre-silver enterprise value of $ 65.95 billion.
India is the key to Facebook’s WhatsApp messaging service, which has more than 400 million users in the country.
Facebook said it would work with Jio to create “new ways for individuals and businesses to operate more efficiently in the growing digital economy.”
This could include the combination of JioMart, the small business initiative of Jio and WhatsApp to connect people to businesses and stores. This decision is timely as Facebook prepares to launch a payment feature for WhatsApp in India.
The investment could be essential for a number of reasons, including access to the base of more than 380 million users of Jio Platforms as well as political support from Ambani.
Facebook has tried various means to gain a strong foothold in the Indian market in recent years, but it has not always been successful. In 2016, Indian regulators blocked a Facebook service called “Free Basics” which aimed to give free access to popular web services such as Wikipedia.
The premise was that some sites did not charge users for data charges. But that, critics said, went against the idea of ”net neutrality” – the idea that all sites should be treated equally when it comes to data.
Facebook’s shares rose 2.5% in after-hours trading.