Reliance Industries to create electronic manufacturing JV with Sanmina
Reliance Strategic Business Ventures Limited (RSBVL), a fully-owned subsidiary of Reliance Industries Limited (RIL), has agreed to create a joint venture (JV) with Sanmina Corporation, an American electronics manufacturing solutions company.
The joint venture is being created through an investment of INR 1,670 crores by Reliance Strategic Business Ventures in Sanmina’s Indian entity — Sanmina SCI India Private Ltd (SIPL).
To be based in Chennai, the joint venture will create an electronic manufacturing hub in India. Reliance Strategic Business Ventures will own a stake of 50.1% in it, while Sanmina will hold the remaining 49.9% stake.
As per the terms, Sanmina will chip in with its existing contract manufacturing business to the joint venture, which will be capitalized with more than $200 million of cash for funding its growth.
Jure Sola — Chairman and CEO of Sanmina said: “We are excited to partner with Reliance to build the premier integrated manufacturing solutions company in India.
“This joint venture will service both domestic and export markets and represents a major milestone in the Indian government’s “Make in India” initiative.”
The electronic manufacturing joint venture will be engaged mainly in producing high technology infrastructure hardware for communications networking such as 5G, hyperscale datacenters, and cloud infrastructure, as well as medical and healthcare systems, defense and aerospace, and industrial and cleantech.
Akash Ambani — 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.”
Apart from supporting the existing customer base of Sanmina, the joint venture will create a manufacturing technology center of excellence, which will work as an incubation center. The hub will underpin the product development and hardware start-up ecosystem in India and promote research and innovation of latest technologies.
The deal, which is subject to regulatory approvals and customary closing conditions, is likely to close by September 2022.