RIL subsidiary, Sanmina enter JV to boost manufacturing in India

Integrated manufacturing solutions company Sanmina Corporation and Reliance Industries subsidiary Reliance Strategic Business Ventures Limited (RSBVL) announced on Thursday that they have entered into an agreement to create a joint venture via an investment in Sanmina’s Indian entity—Sanmina SCI India Private (SIPL), as per the official RIL release.

The release further said RSVBL will hold 50.1 per cent equity stake whereas Sanmina will own the remaining 49.9 per cent stake in this JV.
 
It states, “RSVBL will achieve this ownership primarily through an investment of upto Rs 1,670 crore in new shares in Sanmina’s existing Indian entity, while Sanmina will contribute its existing contract manufacturing business.”
 
It explains that the JV will be capitalised with over $200 million of cash to fund growth.
 
The RIL release also mentions that this partnership between RSBVL and SIPL will utilise the latter’s experience in advanced manufacturing and the Reliance’s expertise in Indian business ecosystem. Day-to-day business will be managed by Sanmina’s existing management team based out of Chennai.
 
With this JV, both the companies aim to create a world-class manufacturing hub in India which is in line with PM Modi’s “Make in India” vision. The JV will prioritise high technology infrastructure hardware for growth markets and across sectors like communications networking (5G, cloud infrastructure, hyperscale datacenters), medical and healthcare systems, industrial and cleantech and defence and aerospace.
 
Through this JV, Sanmina expects to grow the scale of business over time and expand its manufacturing footprint to serve the local and global demand for hi-tech equipment across industries. Manufacturing will take place at Sanmina’s Chennai plant.
 
Commenting on the JV, Reliance Jio Director Akash Ambani 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.”

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