Internet search giant Google will invest up to $1 billion in Bharti Airtel through the purchase of a 1.28% stake and a commercial agreement on mutual terms over the next five years.
Google will invest the amount, as part of the Google for India Digitization Fund, in the country's second largest telecom service provider, making it the only company to have invested in both Reliance Jio and Bharti Airtel.
The investment includes $700 million in equity investment in Bharti Airtel at â‚¹734 per share and $300 million to implement commercial agreements, which will include investments in expanding Airtel's offering covering a range of consumer devices through innovative programs and of affordability. Offerings aimed at accelerating access and digital inclusion across India’s digital ecosystem.
Sunil Bharti Mittal, Chairman of Bharti Airtel, said: "Airtel and Google share a vision of increasing India's digital profits through innovative products. Through our network, digital platforms, final distribution system and payment system prepared Going forward, we look forward to working closely with Google to further increase the depth and breadth of India's digital ecosystem."
The two companies said in a statement Friday that business deals will be identified and agreed to on mutually agreed terms over the next five years.
The announcement was made after Airtel's board approved the proposal on Friday. Shares of Airtel rose 0.7% to â‚¹711.95 on the Bombay Stock Exchange at 9:40 a.m.
This deal will be subject to the necessary regulatory approvals.
"As part of their first commercial agreement, Airtel and Google will work together to take advantage of Airtel's extensive offerings covering a range of Android-powered devices for consumers through innovative affordability programs," the companies said.
Together, they added, the two companies will continue to explore new opportunities to remove barriers to smartphone ownership at a variety of price points, in partnership with various device manufacturers.
“Our business and equity investment in Airtel is a continuation of the efforts of the Google for India Digitization Fund to increase access to smartphones, improve connectivity to support new business models and help businesses on their transformation journey. digital,” said Sundar Pichai, CEO of Google and Alphabet.
Under the larger strategic goals of the partnership, both companies are also likely to be involved in creating India's own network domain use cases for 5G and other standards, with cutting-edge implementations.
Airtel said it was already using Google's fifth-generation-ready Google Evolved Packet Core and Software Defined Network platforms, and plans to explore scaling up the deployment of Google's network virtualization solutions to deliver a network experience to their customers.
Both companies will also focus on shaping and growing the cloud ecosystem in India to accelerate their digital transformation journeys. Airtel serves over one million small and medium-sized businesses through its business connectivity offering, and this partnership will help accelerate digital adoption.
The two organizations recognize the importance of a connected India, in empowering businesses as they go through their digital transformation journeys and in building a strong digital ecosystem for consumers everywhere. Both organizations are committed to working to build an open technology ecosystem serving customers and businesses with innovative digital services and have agreed to jointly explore and invest in a wide range of areas to create digital solutions that uniquely meet India's requirements.
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