Billionaire Mukesh Ambani-led Reliance Industries on Tuesday said that its wholly-owned subsidiary Reliance Strategic Business Ventures Limited (RSBVL) has completed its previously announced joint venture transaction with US-listed Sanmina Corporation.
The joint venture transaction between Reliance and Sanmina is expected to create manufacturing hub in the country which will be in line with Prime Minister Narendra Modi’s ‘Make in India’ vision, the company said.
RSBVL will hold 50.1 per cent equity stake in the joint venture while Sanmina will have 49.9 per cent shareholding. The former will achieve this ownership primarily through an investment of up to Rs 1,670 crore in new shares in Sanmina's existing Indian entity. With the investment, the entity will become a joint venture.
While the partnership is expected to leverage Sanmina’s 40 years of advanced manufacturing experience, it will also bring to the fore Reliance’s expertise in the Indian business environment, Reliance said.
The day-to-day business will continue to be managed by Sanmina’s team in Chennai which is expected to be seamless from an employee and customer perspective, the country’s most profitable company added.
“The priority of this joint venture is to render high technology infrastructure hardware for growth markets and across industries like communications networking (5G, cloud infrastructure, hyperscale datacentres), medical and healthcare systems, industrial and cleantech, defense and aerospace,” Reliance said.
While the Reliance and Sanmina joint venture is expected to give support to the latter’s current customer base, it will also create a state-of-the-art ‘Manufacturing Technology Centre of Excellence’ that will serve as an incubation centre to support product development and hardware start-up environment in the country. It is also aimed at promoting research and innovation of leading-edge technologies.
US-based Sanmina Corporation is a leading integrated manufacturing solutions provider and it will oversee the manufacturing part. All the activity will take place at the company’s 100-acre campus in Chennai, with the ability for site expansion for future growth opportunities.
RSBVL is known for trading of goods and providing business support services, Sanmina is known for its work as a manufacturing solutions provider. The latter also claims to be serving the fastest growing segments of the global Electronics Manufacturing Services (EMS) market.
