Mumbai: Reliance Industries Ltd (RIL) board of directors has approved the formation of wholly-owned digital services subsidiary with a capital infusion of Rs 1.08 lakh crore.
The new company will become the conglomerate's umbrella platform for all digital businesses including Jio. The Rs 1.08 lakh crore investment will be in the form of a rights issue of optionally convertible preference shares (OCPS).
The wholly-owned subsidiary will also acquire RIL's equity investment of Rs 65,000 crore in Jio so far, making it virtually net debt-free by March 31, 2020, with the exception of spectrum-related liabilities.
"This new company will be a truly transformational and disruptive digital services platform," said RIL Chairman and Managing Director Mukesh Ambani.
"It will bring together India's number one connectivity platform, leading digital app ecosystem and the world's best tech capabilities globally to create a truly digital society for each Indian." Jio has been heralding the digital services revolution in India and will continue to do so in the years to come, said Ambani in a statement released late on Friday hinting at making way for the entry of a strategic investor.
"Given the reach and scale of our digital ecosystem, we have received strong interest from potential strategic partners. We will induct the right partners in our platform company, creating and unlocking meaningful value for RIL shareholders," he said.
Ambani said the group continues to focus on cutting-edge, technology-enabled digital platforms that enable and accelerate digital society with frictionless and seamless universal access and adoption with a focus on healthcare, education, agriculture, commerce, government-to-citizen services, gaming, manufacturing and many others.
These platforms are also backed by investment in emerging and next-generation technologies like blockchain, artificial intelligence and machine learning, virtual, augmented and mixed reality, computer vision, high performance and edge computing, natural language processing and voice-enabled services.
RIL is India's largest private sector company with a consolidated turnover of Rs 6.23 lakh crore, cash profit of Rs 64,478 crore and a net profit of Rs 39,588 crore for the year ended March 31. Its activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and digital services.
Jio is a 4G-based telecom operator having than 35.5 crore subscribers. It is future-ready and can be easily upgraded to support even more data as technologies advance on to 5G, 6G and beyond.