Amazon Looks To Acquire A Near 10% Stake In Reliance Retail, After Facebook, Google Back Sister Company Jio

Amazon.com, Inc AMZN is looking to pick up a 9.9% stake in Indian behemoth Reliance Industries Ltd.'s retail arm, according to a report from Indian publication ET Now on Thursday.

What Happened

The e-commerce company is said to be primarily interested in a "preferred, strategic stake" in Reliance Retail for its grocery delivery service Jiomart.

The service is the retail company's joint venture with fellow Reliance subsidiary, and telecom operator, Jio Platforms.

The group's chairman, Mukesh Ambani, disclosed at the Indian conglomerate’s annual general meeting this month that the company will “induct global partners and investors in Reliance Retail in the next few quarters.”

Morgan Stanley last valued Reliance Retail at about $29 billion.

Why It Matters

JioMart is likely to present a challenge to Amazon in India, one of the latter's key global markets.

The Seattle-based company has also been locked in an intense battle with Reliance over acquiring stake in India's second-largest retail chain, Future Retail, according to ET Now.

The talks between Jeff Bezos and Ambani are reported to be taking place in the backdrop of heightened interest in the Indian retail chain as well as the company’s Jio platforms.

Facebook Inc FB, Intel Corporation INTC, and Alphabet Inc GOOGL GOOG subsidiary Google are some of the companies to have announced their plans to invest in Jio in recent months.

In total, Jio has garnered about $20 billion by selling a 33% stake to over a dozen international investors that also included Silver Lake, Vista Equity Partners, and General Atlantic.

On Thursday, the 63-year-old Ambani replaced former Microsoft Corporation MSFT CEO Steve Ballmer to become the fifth-richest person in the world with an estimated net worth of $77.4 million.

Price Action

Amazon shares traded 1.2% lower in the pre-market session Friday at $2,950.00.