Mukesh Ambani’s Jio Platforms has expressed interest in acquiring a stake in Sri Lanka Telecom PLC, the state-owned telecom company of Sri Lanka. This development comes as the Sri Lankan government grapples with financial challenges and endeavours to privatize key sectors for economic recovery.
Despite a pressing financial crisis, Sri Lanka has been actively seeking private investors for its cash-strapped Telecom PLC. The government invited potential bidders, receiving responses from three companies, including Jio Platforms, Gortune International Investment Holding Ltd, and Pettigo Comercio International LDA.
On January 12, the Sri Lankan government officially named Jio Platforms as one of the potential bidders for its telecom company, highlighting its commitment to evaluating proposals per the Special Guidelines on Divestiture of State-Owned Enterprises approved by the Cabinet of Ministers.
The move aligns with Sri Lanka’s obligations to the International Monetary Fund (IMF), which mandated the country to privatize non-core sectors to alleviate its severe cash shortage, a crisis that triggered anti-government protests in 2022.
Jio Platforms, a leading player in the Indian telecom market, is eyeing this investment as an opportunity to establish its dominance on the global stage. The company has consistently held the market leader position among Indian telecom service providers. Recent data from the Telecom Regulatory Authority of India (TRAI) revealed that in October 2023, Jio added a substantial 31.59 lakh mobile users, outpacing its top competitor, Bharti Airtel.
This potential investment in Sri Lanka marks a significant step for Jio Platforms, signalling its ambition to transcend national boundaries and become a major player in the international telecommunications arena. The move comes on the heels of Mukesh Ambani’s investment announcements at the Vibrant Gujarat Summit 2024 in Gandhinagar, which triggered a rally in Reliance and Jio shares. As a result, Ambani reclaimed the title of the richest person in Asia.
As Jio Platforms navigates the bidding process alongside Gortune International Investment Holding Ltd and Pettigo Comercio International LDA, the telecom industry watches closely. The outcome could reshape the landscape not only for Jio Platforms but also for the telecommunications sector in Sri Lanka, offering a potential lifeline for the cash-strapped state-owned company.