Reliance Industries Limited (RIL) on Thursday announced a manufacturing joint venture of its subsidiary Reliance Strategic Business Ventures Limited (RSBVL) with a leading integrated manufacturing solutions company Sanmina Corporation (Sanmina) through investment in its existing Indian entity.
RSBVL will hold a 50.1 per cent equity stake in the joint venture entity with Sanmina owning the remaining 49.9 per cent, as per a joint press statement.
The joint venture will create a world-class electronic manufacturing hub in India, in line with the Prime Minister's "Make in India" vision, the statement said.
The partnership is said to leverage Sanmina's 40 years of advanced manufacturing experience and Reliance's expertise and leadership in the Indian business ecosystem.
The day-to-day business will continue to be managed by Sanmina's existing management team in Chennai, which will be seamless from an employee and customer perspective.
"RSBVL will achieve this ownership primarily through an investment of up to Rs 1,670 crore in new shares in Sanmina's existing Indian entity, while Sanmina will contribute to its existing contract manufacturing business," the statement said.
As a result of the investment, the joint venture will be capitalized with over USD 200 million of cash to fund growth.
Akash Ambani, the Director of Reliance Jio, said, "We are delighted to work with Sanmina to access the significant market opportunity for high-tech manufacturing in India. For both growth and security, it is essential for India to be more self-reliant in electronics manufacturing in Telecom, IT, Data Centers, Cloud, 5G, New Energy and other industries as we chart our path in the new digital economy. Through this partnership we plan to boost innovation and talent in India, meeting both Indian and global demand."
"We are excited to partner with Reliance to build the premier integrated manufacturing solutions company in India," stated Jure Sola, Chairman and Chief Executive Officer of Sanmina.
"This joint venture will service both domestic and export markets and represents a major milestone in the Indian government's 'Make in India' initiative," Sola added.
Completion of the transaction is subject to customary closing conditions, including regulatory approvals. The transaction is expected to close no later than September 2022.
( With inputs from ANI )
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