Reliance Jio connects with Facebook for $5.7-billion equity deal

Investment values Jio Platforms at Rs 4.36 trn; US giant gets 9.99% stake, board seat; collaboration is non-exclusive.

Facebook and Reliance Jio hit the headlines early Wednesday morning, in a break from the daily lockdown news. Mark Zuckerberg announced in a Facebook post that the technology giant will acquire a 9.99 per cent stake in Jio Platforms Ltd (JPL) through a fresh issue of shares worth Rs 43,574 crore.

The deal values JPL—the holding company of Reliance Jio — at an enterprise value Rs 4.62 trillion.

JPL’s equity value works out to Rs 4.36 trillion after Facebook’s investment, making it the fifth most valuable company in the country, behind its parent Reliance Industries (RIL), Tata Consultancy Services, Hindustan Unilever, and HDFC Bank.

Considering the market value of RIL and JPL, the Street is valuing RIL’s remaining but core businesses of refining and petrochemicals and others such as retail at a lesser number of Rs 4.28 trillion. This makes JPL more valuable than the rest of RIL.

JPL, a fully-owned subsidiary of Reliance Industries Ltd, houses many digital platforms like Jio Saavn and Radisys, besides the biggest disruptor in the Indian telecom scene, Jio.

As part of the deal, Facebook will get a board seat in JPL and an observer seat without voting powers. At a concall, a couple of hours after the news broke, Facebook India CEO Ajit Mohan said, “the very fact that we are announcing the deal during Covid-19 is a reflection of our commitment to invest in the country.’’

However, both sides made it clear that they will continue to compete in many areas where they have their own digital products. For instance, while Jio Pay is already operational, Facebook is awaiting permission for its digital payment platform. Also, Reliance has Jio Chat, which competes with WhatsApp directly.

“We will collaborate, not integrate. And in some areas, we will also compete as we have our own product lines. The deal is also not exclusive,” said Anshuman Thakur, head of strategy at Reliance Jio. He also pointed out that Jio or JPL could go public, but only in the medium term, in about three to four years.

Classes in Cloud: Online teaching becomes order of the day amid lockdown

With the lockdown in force, live online teaching has become the order of the day, report Peerzada Abrar and Sai Ishwar

For the past few weeks, Father Muller Medical College in Mangaluru, Karnataka, is conducting virtual surgery classes for its students. In New Delhi, a pre-school is teaching kids rhymes and conducting online classes daily for each toddler. Education group PES has replicated online the entire physical campus experience for its schools, engineering and medical colleges across Karnataka, with over 1,000 classes being held daily.

At a time when India is under a nationwide lockdown to fight the coronavirus pandemic, much of the country’s $180 billion education sector is going online to adapt to the new reality. Many educational institutions are creating virtual learning infrastructure and radically transforming the way education has been offered for millennia. And to help them realise that goal, they are reaching out to technology companies such as Impartus Innovations, Amazon Web Services (AWS), Coursera and Tata Consultancy Services (TCS).

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Last week, the government of India also launched a week-long “Bharat Padhe Online” campaign to crowdsource ideas for improving the online education ecosystem in the country. Within three days of launching the campaign, the Union human resource development ministry received more than 3,700 suggestions.

“The coronavirus situation is forcing everyone to adopt online learning,” says Raghav Gupta, managing director, India and APAC, at Coursera, one of the world’s largest online learning platforms. Gupta says India has over 37 million students enrolled in higher education across thousands of universities and colleges.

In view of the lockdown, Coursera is giving universities and colleges free access to its catalogue through its “Coursera for Campus” platform. The platform enables almost any university in the world to deliver high quality, job-relevant, on-demand learning to students, alumni, faculty and staff.

Brazilian President Bolsonaro calls for investments by Indian companies

Brazil is pushing India to expand its footprint in the country's mining, power and agri business sectors.

Brazilian President Jair Bolsonaro on Monday called for greater investment by Indian conglomerates in the Latin American country's infrastructure, railways, mining and energy sectors.

Addressing senior captains of industry, Bolsonaro, along with senior minister's from the Brazilian government pitched for more investments from India. Brazil's economy is broadly expected to slowly regain health in 2020, with gross domestic product growth estimated at 2.3 per cent by the country's central bank.

Winning on a populist plank to eradicate poverty and clean up corruption, Bolsanaro has pushed for large scale foreign investment to tap the country's vast natural resources, especially in the Amazon rainforest in the scarcely populated hinterland. Indian companies have invested about $ 6 billion in the country, and has significant footprint in multiple sectors sectors.

This includes Information Technology giants such as Tech Mahindra and Tata Consultancy Services which has about 1400 employees. In the mining sector, Sterlite Power has won 10 power transmission projects across 11 Brazilian states totalling 29 transmission lines and 34 substations while Birla Carbon, the world's largest carbon black producer, completed 60 years of operations in Brazil in October 2018.

Pharmaceutical, Energy, engineering and automobile production were also sectors central to Indian business interests, sources said. Policymakers said that among that bilateral pacts to boost cooperation in oil and natural gas and bio-energy, that were signed over the weekend is expected to see significant Indian businesses entering Brazil.

Bolsanaro met with 23 Indian business leaders from companies including those from Sterlite Power, Apollo Hospital, Oyo Rooms, Tech Mahindra, Tata Consultancy Services, Zydus Cadila, and Transport Corporation of India Limited, among others.

Business Standard