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In a groundbreaking development, rival billionaires Mukesh Ambani and Gautam Adani have joined forces for their first-ever collaboration on a power project in Madhya Pradesh. This unprecedented partnership sees Ambani’s Reliance acquiring a 26 percent stake in Adani Power’s project in MP, marking a significant step in their business dynamics.
Reliance will acquire 5 crore equity shares in Mahan Energen Ltd, a wholly-owned subsidiary of Adani Power Ltd, at par value of ₹10 each (totaling ₹50 crore). The collaboration entails utilizing 500 MW of electricity generated by the plants for captive use, as per the pact signed between the two conglomerates.
Adani Power, in its official filing, stated, “Mahan Energen Ltd (MEL), a wholly-owned subsidiary of Adani Power Ltd (APL), has entered into a 20-year long-term power purchase agreement (PPA) for 500 MW with Reliance Industries Ltd (RIL), under the captive user policy as defined under the Electricity Rules, 2005.”
The agreement further elaborated that Reliance must hold a 26 percent ownership stake in the captive unit proportionate to the total power plant capacity to avail benefits under the captive user policy. Consequently, Reliance will invest ₹50 crore in 5 crore equity shares of MEL to secure the designated ownership stake.
This collaboration marks a departure from the traditional competitive stance between Adani and Ambani, who hail from Gujarat and have often been pitted against each other in various business spheres. Their rivalry extends to the title of Asia’s richest person, with both entrepreneurs vying for supremacy in their respective industries.
While Ambani’s business interests span across oil and gas, retail, and telecom, Adani’s focus encompasses infrastructure, including sea ports, airports, coal, and mining. Despite their divergent business trajectories, they have found common ground in the clean energy sector, where both have announced substantial investments.
Adani has expressed ambitions to become the largest renewable energy producer globally, while Reliance under Ambani’s leadership is embarking on significant initiatives in clean energy, including the establishment of four gigafactories in Jamnagar, Gujarat, dedicated to solar panels, batteries, green hydrogen, and fuel cells.
Although competition between Ambani and Adani was expected during the auction of 5G spectrum airwaves, Adani secured spectrum in the 26 GHz band, distinct from public networks, avoiding direct competition with Reliance in this domain.
The collaboration between these industry titans not only signifies a strategic move in the power sector but also reflects evolving dynamics in India’s corporate landscape, emphasizing cooperation and synergy in key sectors for mutual growth and development.
Sources By Agencies
