Reliance to take a position $220 mln in Sanmina JV in electronics manufacturing push

A hen flies previous a Reliance Industries brand put in on its mart in Ahmedabad, India January 16, 2017. REUTERS/Amit Dave

BENGALURU, March 3 (Reuters) – Indian conglomerate Reliance Industries (RELI.NS) stated on Thursday it will make investments 16.7 billion rupees ($220.70 million) to create a three way partnership (JV) with U.S.-listed Sanmina Corp (SANM.O) for making digital merchandise within the Asian nation.

The JV goals to make {hardware} for 5G communications, cloud infrastructure, healthcare techniques, clear know-how, and protection and aerospace, Reliance stated in a regulatory submitting.

The deal comes as India pushes for extra funding within the manufacturing sector in a bid to determine the nation as a world electronics manufacturing hub. India has supplied about $30 billion in incentives to woo electronics producers to arrange store in India.

Billionaire Mukesh Ambani’s Reliance will maintain a 50.1% stake within the JV after the funding in Sanmina’s current Indian entity via a Reliance unit. Sanmina will contribute its current contract manufacturing enterprise to the JV.

The JV will service each home and export markets, Sanmina Chief Govt Officer Jure Sola stated in an announcement.

All manufacturing will initially happen at Sanmina’s campus within the south Indian metropolis of Chennai, with an choice for growth in different manufacturing websites inside the nation.

Sanmina, whose Indian entity Sanmina SCI India Non-public Ltd raked in income of about 12.3 billion rupees for the fiscal yr ended March 31, 2021, appears to scale up its current footprint in India with the deal.

Reliance has in recent times diversified away from its mainstay oil enterprise, constructing its presence within the retail and telecom industries. It final yr unveiled an aggressive plan to foray into inexperienced power.

Reliance shares rose as a lot as 0.7% after the deal on Thursday, earlier than paring positive factors to commerce marginally decrease by 0416 GMT.

($1 = 75.6700 Indian rupees)

Reporting by Chris Thomas in Bengaluru; Modifying by Anil D’Silva

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