Mukesh Ambani, the chairman of Reliance Industries, has made a significant move in the power sector by acquiring a 26% stake in ‘s Madhya Pradesh project. This landmark deal brings together two of India’s wealthiest billionaires and globally renowned industrialists for the first time in a ‘power’ pact.
In this strategic collaboration, Reliance Industries will invest Rs 50 crore to acquire a minority stake in Mahan Energen, a subsidiary of Adani Power. Additionally, Reliance will procure 500 megawatts of electricity from Adani’s Madhya Pradesh plant to meet its energy requirements. The partnership is facilitated by India’s electricity regulations, allowing for an exclusive power arrangement between the two companies for the next two decades.
Adani Power has designated one unit of its 600MW capacity Mahan thermal power plant in Madhya Pradesh as a captive unit, aligning with regulatory guidelines. Reliance Industries, in order to capitalize on these regulations, has opted to acquire a strategic 26% stake in the captive unit, making a significant investment in the process.
While the specifics of how Reliance Industries intends to utilize the power sourced from Mahan Energen have not been disclosed, the deal is expected to be finalized within two weeks pending regulatory approvals. Notably, Reliance Industries already operates captive power plants in its oil refining and petrochemical complex in Gujarat.
The collaboration between Mukesh Ambani and Gautam Adani, both originating from Gujarat, is noteworthy given their perceived rivalry in certain industry circles. While Ambani’s business interests span oil and gas, retail, telecom, and financial services, Adani’s focus lies in infrastructure sectors such as airports, seaports, and cement production.
Despite their differing business domains, Ambani and Adani have occasionally intersected paths, particularly in media, clean energy, and data centers. Two years ago, a company associated with Ambani sold interests in news broadcaster NDTV to Adani, marking the latter’s entry into the media sector and setting the stage for competition with Ambani’s Network 18.
Both industrialists have also committed substantial investments in clean energy initiatives, aligning with global efforts to achieve zero net carbon emissions by 2050. Their recent collaboration in the power sector reflects a convergence of interests towards sustainable energy solutions.
With Ambani ranked as the 11th richest person globally with a net worth of $117 billion according to Forbes, and Adani not far behind at the 17th position with a net worth of $81 billion, this partnership signifies a significant development in India’s corporate landscape, showcasing the potential for collaboration and innovation in key sectors for national development and sustainability.
