In a groundbreaking move, Mukesh Ambani and Gautam Adani, two of India’s rival billionaires, have come together for a business deal, marking a significant departure from their usual competitive stance. Reliance Industries Limited (RIL) has acquired a 26% stake in Mahan Energen Ltd (MEL), a subsidiary wholly owned by Adani Power Ltd. This strategic agreement grants RIL access to 500 MW of electricity generated by MEL’s power plants in Madhya Pradesh for its captive use. As part of the deal, one unit of MEL’s Mahan thermal power plant, with a capacity of 600 MW out of a total capacity of 2,800 MW, will be designated as the Captive Unit for RIL’s purposes.
The acquisition involves RIL purchasing 5 crore shares of MEL with a face value of ?10 each, amounting to ?50 crore. RIL emphasizes that this investment aligns with the provisions outlined in the Electricity Rules of 2005, which mandate that a captive user must hold a minimum 26% stake in the captive unit. Despite their status as business rivals, Ambani’s diverse interests encompassing oil and gas, retail, and telecom, and Adani’s focus on infrastructure, including sea ports, airports, coal, and mining, have rarely led to collaborative ventures. However, both have found common ground in the clean energy sector, where they have previously announced significant investments.
Adani has set ambitious goals to become the world’s leading renewable energy producer by 2030, while Reliance is forging ahead with plans to establish four gigafactories in Jamnagar dedicated to solar panels, batteries, green hydrogen, and fuel cells. Additionally, Adani is progressing with the construction of three gigafactories focused on manufacturing solar modules, wind turbines, and hydrogen electrolysers. This collaboration underscores a shared commitment to advancing the renewable energy landscape while leveraging each other’s strengths in pursuit of sustainable growth.
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