Facebook will acquire a 9.9 per cent stake in Jio Platforms announced last month via a new entity, Jaadhu Holdings, LLC as per regulatory documents.
According to a submission made to the Competition Commission of India (CCI), Jaadhu Holdings, LLC is an indirect wholly-owned subsidiary of Facebook, Inc." Jaadhu is a newly incorporated company formed in March 2020 under the laws of the State of Delaware, US. So far, Jaadhu is not engaged in any business in India or anywhere in the world," it said.
The notification form is being filed in relation to Jaadhu's proposed acquisition of a minority, the non-controlling shareholding of approximately 9.99 per cent of the fully diluted equity share capital, in Jio Platforms, it added.
In April, Facebook had announced an investment of $5.7 billion (Rs 43,574 crore) in Jio Platforms and the two companies disclosed that this is a submission to India’s antitrust competition watchdog, seeking clearance for the deal.
Simultaneously, Jio Platforms, Facebook-owned instant messaging service WhatsApp, Inc., and Reliance Retail Ltd (RRL) are proposing to enter into a separate commercial agreement, it added.
JioMart, a new RRL commerce marketplace which connects customers with Kirana stores and other small and microlocal Indian businesses, plans to integrate certain WhatsApp services with JioMart.
The submission noted that the proposed transaction does not alter the competitive landscape in any potential market, and Facebook and Jio Platforms will continue to operate independently.
"The proposed transaction and the proposed commercial arrangement are pro-competitive, beneficial for consumers, Kirana stores and other small and micro-local Indian businesses, and takes forward the vision of digital India," the filing read.
There is also no significant overlap between the two business segments that Facebook and Jio Platforms operate in - advertising services and consumer communication applications, respectively, it said.
Over the past few weeks, Reliance Industries' digital unit Jio Platforms has raised Rs 78,562 crore from marquee technology investors, including Facebook, KKR, Silver Lake Partners, Vista Equity Partners, and General Atlantic. It is also in talks with other potential investors for additional investments into Jio Platforms.
Since the announcement of Facebook's investment in Jio Platforms, the subsidiary of Mukesh Ambani-led Reliance Industries has raised a further Rs 34,988 crore from PE firms KKR, Vista Equity Partners, General Atlantic and Silver Lake, at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore.