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CCI okays acquisition of 50.1% stake in Sanmina SCI India by Reliance Strategic Business Ventures

In March this year, Sanmina entered into an agreement with RSBVL to create the joint venture which will a world-class electronic manufacturing hub in India. (Bloomberg)Premium
In March this year, Sanmina entered into an agreement with RSBVL to create the joint venture which will a world-class electronic manufacturing hub in India. (Bloomberg)

  • Sanmina Corp and RSBVL have inked an agreement to create a joint venture through investment in Sanmina’s existing Indian entity (Sanmina SCI India). RSBVL is set to invest 1,670 crore in the JV and hold the majority stake. The JV will serve both domestic and export markets.

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The Competition Commission of India (CCI) on Tuesday granted its approval for the acquisition of a 50.1% stake of Sanmina-SCI India (SCIPL) by Reliance Strategic Business Ventures (RSBVL). RIL is a subsidiary of Reliance Industries. Sanmina Corporation and RSBVL have inked an agreement to create a joint venture through investment in Sanmina’s existing Indian entity (Sanmina SCI India). RSBVL is set to invest 1,670 crore in the JV and hold the majority stake. The JV will serve both domestic and export markets.

While approving, in a statement, CCI said, "The proposed combination envisages acquisition of 50.1% of the equity share capital of SCIPL by RSBVL."

In March this year, Sanmina entered into an agreement with RSBVL to create the joint venture which will a world-class electronic manufacturing hub in India. The JV will prioritize high technology infrastructure hardware, for growth markets, and across industries such as communications networking (5G, cloud infrastructure, hyper scale datacenters), medical and healthcare systems, industrial and cleantech, and defense and aerospace.

Additionally, the JV is expected to create a state-of-the-art ‘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.

Under the agreement, RSBVL will hold a 50.1% equity stake in the joint venture entity with Sanmina holding the remaining 49.9%. The RIL-backed company will achieve this ownership primarily through an investment of up to 1,670 crore in new shares in Sanmina’s existing Indian entity, while Sanmina will contribute its existing contract manufacturing business. That said, the joint venture will be capitalized with over $200 million of cash to fund growth.

RSBVL’s principal activities are trading goods, holding strategic investment interests in businesses, and providing business support services.

SCIPL is an indirect subsidiary of Sanmina Corporation, a Fortune 500 company headquartered in San Jose, California, USA. Sanmina is a global provider of integrated manufacturing solutions, components, products and repair, logistics, and after-market services. It provides its services to original equipment manufacturers primarily in the communications networks, computing, and storage, medical, defense and aerospace, industrial and semiconductor, multi-media, automotive, and clean technology sectors.

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