Airtel’s stock was up about 2% in early trading at Rs 720.55 per share.

Google will invest up to $1 billion in Bharti Airtel, including an equity investment of about $700 million to acquire a stake in the company, to bring affordable smartphones and develop India specific 5G use cases, the telco said in an announcement Friday. Google will acquire about 1.28% stake in the company at a price per share of Rs 734, the company added. Airtel’s stock was up about 2% in early trading at Rs 720.55 per share.

The company also said up to $300 million of investment will go towards implementing commercial agreements. “As a part of its first commercial agreement, Airtel and Google will work together to build on Airtel’s extensive offerings that covers a range of Android-enabled devices to consumers via innovative affordability programs,” Airtel said. The two companies will make available smartphones across a range of price points, in partnership with various device manufacturers, it added.

Through the deal, Google and Airtel will continue to explore building on their existing partnerships to potentially co-create India-specific network domain use cases for 5G and other standards, and help accelerate the cloud ecosystem for businesses across India, it said. Upto 71,176,839 equity shares will be allotted to Alphabet Inc’s Google on a preferential basis at face value of Rs 5 each of the company aggregating to Rs 5,224.3 crore.

Google CEO Sundar Pichai said this partnership will help in ensuring equitable access to the internet for more Indians. “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,” he added.

Google will invest this money into Airtel through its $10 billion Google for India Digitization Fund partnering on a long-term, multi-year agreement tapping the fast growing digital ecosystem of India. Google made its first investment in India through this fund by investing $4.5 billion in rival Reliance Jio last year. Google owns about 8% stake in Reliance Jio Platforms.

https://www.financialexpress.com/industry/google-to-invest-up-to-1-bln-in-airtel-including-700-mln-cash-for-1-28-stake-to-make-cheap-smartphones/2418006/