Billionaire Mukesh Ambani's Asset Management Venture Dangles $300M Proposal To Lure BlackRock Back To India

This story was first published on the Benzinga India portal.

Jio Financial Services, an Indian company under the umbrella of billionaire Mukesh Ambani’s Reliance Group, is teaming up with US firm BlackRock Inc BLK to launch an asset management venture in India. Both companies plan to invest $150 million (INR 12.30 billion) each in the new venture.

What Happened? This announcement comes shortly after Jio Financial Services separated from Reliance Industries. The market values the venture at nearly $20 billion (INR 1.64 trillion), even though it’s yet to establish a business in India’s booming financial services sector.

According to Jio Financial Services CEO Hitesh Sethia, the partnership will draw on BlackRock’s proficiency in investment and risk management, as well as Jio Financial’s technological prowess and understanding of the local market.

Why It Matters? The Indian asset management industry, currently managing assets worth INR 4.42 trillion, has seen swift growth in recent years. The joint venture will focus on providing digital-first services, pending regulatory approval. The companies haven’t yet disclosed when they plan to commence operations.

This venture marks BlackRock’s second foray into India’s asset management sector, after exiting a joint venture with DSP Group in 2018.

Larry Fink, Chairman and CEO of BlackRock, took to LinkedIn to announce the venture, seeing it as a significant step in expanding BlackRock’s global footprint.

However, financial investment products in India are underutilized relative to the size of the economy. The percentage of mutual fund assets to India’s GDP is 16%, far below the global average of 63%, as per a May report from brokerage house Angel One.

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