Google to invest $1 bn in Airtel in partnership for cheap smartphones, 5G

Deal includes investment of $700 million to acquire 1.28 per cent ownership in Airtel.

US technology giant Google will invest up to $1 billion in Airtel in a partnership that will focus on affordable smartphones and create India-specific "use cases for 5G", said the telecom company on Friday.

The investment includes a $700 million equity investment in Airtel at a price of Rs 734 rupees per share and up to $300 million towards implementing commercial agreements, including investments in scaling Airtel's offerings, the companies said.

The share issue is subject to regulatory and shareholder approval and comes months after Airtel raised up to Rs 21,000 crore through a sale of shares to existing shareholders.

The companies will also focus on "shaping and growing the cloud ecosystem in India".

Airtel shares were up 0.54% at Rs 711 after the announcement. Google announced plans less than two years ago to infuse $10 billion in India via its digitisation fund over five to seven years through equity deals and tie-ups.

“Airtel and Google share the vision to grow India’s digital dividend through innovative products. With our future ready network, digital platforms, last mile distribution and payments ecosystem, we look forward to working closely with Google to increase the depth and breadth of India’s digital ecosystem,” said Sunil Bharti Mittal, chairman of Bharti Airtel, in the statement.

“Our commercial and equity investment in Airtel is a continuation of our Google for India Digitization Fund's efforts to increase access to smartphones, enhance connectivity to support new business models, and help companies on their digital transformation journey,” said Sundar Pichai, CEO of Google and Alphabet.

Airtel shares were up 0.54% at Rs 711 after the announcement. Google announced plans less than two years ago to infuse $10 billion in India via its digitisation fund over five to seven years through equity deals and tie-ups.

Airtel shares were up 0.54% at Rs 711 after the announcement. Google announced plans less than two years ago to infuse $10 billion in India via its digitisation fund over five to seven years through equity deals and tie-ups.

(With inputs from Reuters)