Google To Invest $1 Billion In Airtel, Acquires 1.28% Stake

As a part of this programme, the two companies will focus on shaping and growing the Cloud ecosystem in India

New Delhi: US technology giant Google will invest around $1 billion in Bharti Airtel as part of its ‘Google for India Digitization Fund’ that will focus on affordable smartphones and create India-specific ‘use cases for 5G’, the telecom major said on Friday.

According to Bloomberg, Alphabet Inc, which owns the Google search engine, will acquire a 1.28 per cent stake in Bharti Airtel at Rs 734 ($9.8) per share, according to an exchange filing from Bharti Airtel on Friday. An additional $300 million will be for multi-year agreements, it said.

As a part of this programme, the two firms will focus on shaping and growing the Cloud ecosystem in India, according to reports.

India is a key growth market for Google’s search and advertising businesses as well as for others such as Facebook, Amazon Inc, and Netflix. Google had previously invested in Mukesh Ambani’s digital unit, Bloomberg said in its report.

Sunil Bharti Mittal, chairman of Bharti Airtel, in the statement said, “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.”

Sundar Pichai, CEO of Google and Alphabet, in a statement said, “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.”

Shares of Bharti Airtel surged as much as 6 per cent in early trade on Friday after the company announced the strategic deal with Google. At 10.45 am, Airtel was trading 1.63 per cent up at Rs 718.