Reliance Industries (RIL) and Sanmina Corporation announced a 50.1-49.9 percent joint venture in India to create an electronic manufacturing hub in India.
Reliance Strategic Business Ventures (RSBVL), a subsidiary of RIL, 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 its existing contract manufacturing business.
As a result of the investment, the joint venture will be capitalized with over $200 million of cash to fund growth.
The JV will prioritize high technology infrastructure hardware, for growth markets, and across industries such as communications networking (5G, cloud infrastructure, hyperscale datacenters), medical and healthcare systems, industrial and cleantech, and defense and aerospace.
Besides supporting Sanmina’s current customer base, the JV will create a Manufacturing Technology Center of Excellence that will serve as an incubation center to support the product development and hardware start-up ecosystem in India, as well as promote research and innovation of leading-edge technologies.
Revenues for SIPL were approximately Rs 12.3 billion (or approximately US$165 million) for the fiscal year ended March 31, 2021. All the manufacturing will initially take place at Sanmina’s 100-acre campus in Chennai, with the ability for site expansion to support growth opportunities as well as to potentially expand to new manufacturing sites in India.
“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,” Akash Ambani, Director, Reliance Jio, said.