Google to invest $1 Billion in Bharti Airtel, to buy 1.28% stake for $700 million
Google will set aside $300 million for potential investment in areas like smart phone access, networks, and cloud
Bharti Airtel and Google have announced a partnership where Google will invest $1 billion (roughly Rs 7,500 crores) in Airtel in order to help grow India’s digital ecosystem, through a mix of equity and commercial partnerships in areas like affordable smartphones, networks, and cloud.
This is the tech giant’s second investment in an Indian telecom service provider (after Reliance Jio) and is part of its $10-billion India digitisation fund. Discussion between the two companies had been going on since the first half of 2021 and culminated in an announcement on Friday.
The deal also includes an investment of $700 million (roughly Rs 5,260 crores) which will allow Google to acquire 1.28 percent ownership in Airtel and the rest $300 million (roughly Rs 2,250 crores) will go towards a multi-year commercial agreements. The two companies will work together to bring best-in-class end-to-end products to serve customer needs, provide quality customer experience, and bring their expertise to solve problems of affordability, access, and digital inclusion.
Bharti could leverage Google’s tech platform to explore monetization of its digital offering. It could leverage the opportunity of a large pool of feature phone subscribers in the market through Google enabled affordable devices, and leverage Google’s 5G technology solutions to offer use cases to SMEs/consumers, including Cloud services. Over time it can derive a big value through new growth areas, as per the brokerage.
The companies said in a statement that they recognise the importance of a “Connected India” in empowering businesses as they progress on their Digital Transformation journeys, and building a strong digital ecosystem for consumers everywhere. “Both organisations are committed towards working to build an open technology ecosystem that serves customers and businesses with innovative digital services, and have agreed to jointly explore and invest across a wide spectrum of areas to create digital solutions that uniquely serves India’s requirements,” the statement said.
