BofA credit deal bets more on Ambani than India

Bank of America will buy a 49.9% stake for up to $1.9 billion in Jio Credit, the non-bank lending unit of Jio Financial Services, the two firms said on August 12.

The U.S. bank will pay 66.13 billion rupees in cash ($693.33 million) for a 26.5% stake in the Indian lender. The rest of the investment will be in the form of warrants convertible within 18 months from the date of allotment.

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

By Shritama Bose

MUMBAI, August 13 (Reuters Breakingviews) - The US bank is buying 49% of Jio Credit, part of the tycoon's vast empire, for up to $1.9 bln. At 2.5 times book value, it's an inexpensive wager on Reliance's potential to disrupt the lending market. It brings Jio new clients, and may boost other BofA businesses in the country.

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