(MENAFN- AsiaNet News) For the first time, Mukesh Ambani and Gautam Adani, two of the wealthiest billionaires in the sub-continent and among the world's richest industrialists, are collaborating in a significant 'power' deal. Their companies announced on Thursday that Ambani's Reliance Industries will acquire a minority stake in a power unit of Adani, marking a historic partnership.
Reliance Industries will purchase a 26% stake in Mahan Energen, a subsidiary of Adani Power, for Rs 50 crore. Additionally, Reliance will source 500 megawatts of electricity from the Mahan thermal power plant in Madhya Pradesh to meet its energy needs. This exclusive arrangement, enabled by India's electricity regulations, binds the two corporate giants in a power agreement for 20 years.
As per the rules, Adani Power will designate one unit of its 600-megawatt Mahan thermal power plant in Madhya Pradesh as a captive unit, aligning with regulations. Reliance Industries will strategically acquire a 26% stake in this captive unit to leverage the regulatory benefits, necessitating an investment.
The specifics of how Reliance Industries intends to utilize the power sourced from Mahan Energen remain undisclosed. However, the deal is anticipated to conclude within two weeks following regulatory approvals. Reliance Industries, known for its captive power plants in Gujarat's oil refining and petrochemical complex, ventures into a new domain through this collaboration.
While Mukesh Ambani's business interests span oil and gas, retail, telecom, and financial services, Gautam Adani has focused on infrastructure, including airports, seaports, and cement. Although they are perceived as rivals in certain sectors, such as media, clean energy, and data centres, the two industrialists have recently demonstrated cooperation.
Two years ago, a company associated with Ambani sold interests in news broadcaster NDTV to Adani, marking Adani's entry into the media sector. This move sparked competition between Ambani's Network 18 and Adani's media ventures. Additionally, both Ambani and Adani have pledged substantial commitments to clean energy to achieve zero net carbon emissions by 2050.
Despite their business rivalry, Ambani and Adani share a personal connection, as evidenced by Adani's attendance at the pre-wedding celebrations of Ambani's son, Anant, earlier this month in Gujarat. With a net worth of $117 billion, Mukesh Ambani ranks 11th on Forbes' list of the world's richest individuals, while Gautam Adani, with a net worth of $81 billion, holds the 17th position, according to Forbes.
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