Facebook reportedly in talks to buy stake in India’s biggest telco

Facebook has been in talks to acquire a 10% stake in India’s Reliance Jio, the telecommunications arm of Reliance Industries, the Financial Times reported, citing people familiar with the matter.

The multibillion-dollar deal is expected to help Facebook expand in the Indian digital market, but dicussions have paused due to the effects of the Covid-19 outbreak, according to the report.

Both Facebook and Reliance Industries declined to comment.

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Jio, valued at more than US$60 billion according to estimates by analysts, has received over US$25 million from Mukesh Ambani, chairman and managing director of Reliance Industries.

The company has become the top telco in India with over 370 million subscribers, which might be one of the reasons for the deal, the report said.

According to Livemint, India seems to be a significant market for the social network, as its messaging app, WhatsApp, has 400 million users in the country. However, the market may be difficult to enter given the government’s proposed restrictions on personal data for overseas companies.

Facebook also previously attempted to offer a free internet service, Free Basics, in India but it failed. In 2017, it expanded its Express Wi-Fi service in the country to let users log on to a Wi-Fi network hosted by local partners, but the project’s potential and scale haven’t been promising.

Starting commercial operations in 2016, Jio thrived in the local telco scene with competitive offers. Its other services include music streaming, on-demand live TV, and payments.

Earlier this year, Jio and Reliance Retail jointly launched an ecommerce platform called JioMart as their parent company bets on the online food and grocery space.