As Reliance continues to transform Jio Platforms into a global digital tech behemoth, the company could now be looking at further diversifying its offerings in the consumer internet space. According to a report from Techcrunch, Reliance could invest in ByteDance’s troubled social media platform, TikTok’s India business. The talks, which are early in nature, could value the currently-banned TikTok’s India business at over $3 Billion.
The timing of this potential deal is not at all surprising. Tiktok is going through its toughest phase, having been banned in its second largest market India, as well as its most lucrative market, the United States. In both geographies, Tiktok had a massive subscriber base. Indian government banned 59 Chinese apps including TikTok more than a month ago because they were a ‘threat to the security and sovereignty of India’. US President Trump also signed an executive order, banning all transactions between ByteDance and any US entity, last week. Microsoft is in talks with ByteDance to acquire TikTok’s U.S. and several other western operations. Interestingly, Twitter has also joined the fray and is mulling a possible merger with Tiktok.
With over 200 million users prior to the ban, India was TikTok’s largest market outside homeland China. The company also employs a sizeable workforce in the country, with over 2000 employees currently on its rolls. ByteDabce is not planning to lay off employees in India right now because it is currently trying to resolve the government’s concerns. The company has however seen some top-level exits.
For Reliance, the deal could make quite a lot of sense. For one, the company has put in a great amount of focus on its digital businesses under Jio Platforms. The company has been on a not-short-of-legendary fundraise spree, raising in excess of $20Bn in COVID-19 stricken months . Investors include the likes of Facebook, Google, Intel, Qualcomm among others. With TikTok under its belt, Jio will get straight up access to over 200 million, mostly young Indians, helping the company amplify its reach to an unprecedented scale.
However, Reliance has not confirmed this news yet. “Our company evaluates various opportunities on an ongoing basis. We have made and will continue to make necessary disclosures in compliance with our obligations under Sebi rules and our agreements with the stock exchanges,” an RIL spokesperson told Times Now.