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‘Jio Platforms’: Reliance Digital Services Including Jio Find New Home

‘Jio Platforms’: Reliance Digital Services Including Jio Find New Home

Jio Platforms Limited will act as an umbrella platform for all the Reliance-owned digital businesses

RIL had announced that a total capital infusion of INR 1.73 Lakh Cr for Jio Platforms Limited

RIL plans to make Reliance Jio debt-free by 2020

After deciding to set up a new subsidiary for its digital services businesses, Mukesh Ambani-led Reliance Industries Ltd (RIL) has now announced that the new venture will be called Jio Platforms Limited.

Jio Platforms Limited is expected to act as an umbrella platform for all the Reliance-owned digital businesses including Reliance Jio, MyJio, JioTV, JioCinema, JioNews and JioSaavn. The newly created subsidiary reportedly will also look after other RIL’s digital entities such as technology-based initiatives in education, healthcare and agriculture services.

RIL had announced that a total capital infusion of INR 1.73 Lakh Cr to set up a wholly-owned subsidiary for its digital initiatives. Jio Platforms was incorporated on November 15, 2019, and is yet to commence its business operations, according to RIL.

Moreover, the company’s board of directors have approved the formation and a capital infusion of INR 1.08 Lakh Cr for Jio Platforms. The investment will be in the form of a rights issue of optionally convertible preference shares. Additionally, the Jio Platforms will also acquire RIL’s total equity investment of INR 65K Cr in Jio.

In a press statement, Ambani had previously said that the new company will be a transformational and disruptive digital service platform. He also added that Jio Platforms will focus on digital services in healthcare, education, agriculture, commerce, government-to-citizen services, gaming and manufacturing sector among others.

Reliance Jio Plans To Go Debt Free

This restructuring will help RIL to transfer all its debt to from Jio to the parent company, with plans to make Jio debt-free from March 2020. However, Jio will still be liable to spectrum related liabilities, RIL had stated previously.

Since the telecom business of Reliance Jio will need further capital as the ecosystem moves to 5G, RIL with investing INR 1.08 Lakh Cr in Jio Platforms Limited will ensure that the new holding has negligible debt on the books, attracting more investors and strategic partners towards the company.

This is not the first time when RIL has demerged its subsidiaries. The Ambani-led RIL has already separated its telecom infrastructure — tower and fibre — into a separate company and monetised it through a deal with private equity firm Brookfield.

Author

Inc42 Staff

Aman is a recent postgraduate in English Journalism. He currently writes on startup ecosystem and technology. You can write to him at [email protected]

https://inc42.com/buzz/blocking-online-gaming-sites-in-india-not-technically-feasible-says-centre/
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