The Hindu Business Line : Reliance Ind: The build-up of a fascinating drama

Even the ending — presuming the curtains are indeed down — was fascinating.Central to the peace brokered at India's biggest business house was the mother, and invoked in her statement to the media and the stock exchange, was the name of God.

In a battle played out across newspapers and television screens, the last laugh should be the media's.

Saturday's announcement contrasted the clarification issued when the spat was first hinted at on November 18, 2004.

Mr Mukesh Ambani, Chairman Reliance Industries Ltd (RIL), told a news channel of differences with his brother, Mr Anil Ambani, over "ownership issues."

He qualified it was in the private domain and discounted fears of Reliance's functioning being hit.

The next day, Reliance stocks and the Sensex fell. On November 22, 2004, Mr Mukesh Ambani said his remarks were "torn out of context."

He claimed the ownership issue was about future business. But a day later, news broke of his e-mail to 80,000 employees emphasising that the Chairman & Managing Director was final authority. On November 23, Mr M.L. Bhakta — RIL Director for 27 years - resigned and was requested to reconsider it.

On November 25, six directors of Reliance Energy Ltd (REL) resigned. Breaking his silence, Mr Anil Ambani said, "there are long hours... and there are going to be long days." The portrayal of the Ambani battle in the media was based often on feeds from within.

Probably, the first of these was the November 26, 2004 report of Mr Anil Ambani's letter to RIL about a July 27 board meeting redefining the powers of the Chairman & Managing Director. Against Mr Mukesh Ambani's assertion that the CMD was final authority, the younger Ambani's questioning indicated dissent.

Mr Anil Ambani and family visited Tirupathi on November 27. Two days later, the media reported that among factors triggering the standoff were Reliance Energy Ltd's (REL) Rs 10,000 crore-proposal for a 3,500-megawatt plant in UP, Mr Anil Ambani being on the Uttar Pradesh Development Council, his joining the Samajwadi Party and getting into the Rajya Sabha. Magazines noted his celebrity lifestyle. Mr Anil Ambani sent an emotional e-mail to Reliance employees wherein he reminded them of the late Dhirubhai Ambani's warnings against "chamchas, chelas and cronies."

On November 30, REL asked its directors to reconsider their resignations and decided to consult RIL on future prospects. December opened with reports of Reliance Infocomm and Bharat Sanchar Nigam Ltd (BSNL) trying to negotiate an out-of-court settlement for the alleged illegal routing of long distance calls by the former.

On December 3, the Supreme Court referred the dispute to the Delhi High Court, even as it directed Reliance to pay the full amount of Rs 182.7 crore demanded by BSNL. The next day, Mr Mukesh Ambani met the Congress President, Ms Sonia Gandhi, and the Union Finance Minister, Mr P. Chidambaram.

With Mr Mukesh Ambani claiming that Dhirubhai Ambani had settled issues of succession during his lifetime, Ambani family members — it was reported on December 6 — sought proof of it. The same day, five of its six directors who had resigned were named in REL's Executive Leadership Council. The next day, REL said, it had presented its growth plans to RIL's board in October. On December 8, Mr Anil Ambani asked how come he never got a copy of the settlement supposedly outlined by Dhirubhai?

Two weeks later, REL said it proposed to take some powers off its CMD (Mr Anil Ambani) and vest it back with RIL, its majority shareholder.

Things grew murkier on December 23 when Mr Mukesh Ambani decided to relinquish his 12 per cent equity stake in Reliance Infocomm and Mr Anil Ambani said that the RIL board was kept in the dark about the telecom company's equity pattern.

On December 27, RIL's board resolved to back Mr Mukesh Ambani. Mr Anil Ambani abstained from voting, including on a buyback resolution. Mr Bhakta, however, withdrew his resignation.

On January 3, 2005, Mr Anil Ambani resigned as Vice-Chairman and Director of IPCL.

Three days later, reports spoke of a legal separation between the brothers and Mr K.V. Kamath, CEO & Managing Director, ICICI Bank Ltd, was cited as facilitating it. On January 19, REL accepted the resignations of two directors.

Two independent directors — Mr Y.P. Trivedi and Mr M.P. Modi — were taken aboard at Reliance Infocomm and Reliance Communications Infrastructure Ltd. Mr Anil Ambani absented himself from IPCL's January 20 board meeting, and the board kept his resignation in abeyance.

On January 21, Mr Trivedi said there had been no violation of corporate governance norms when RIL invested in Reliance Infocomm.

Two days later, Mr Anil Ambani sought details of the legal opinion Mr Trivedi had cited when clearing the charges.

On January 24, allegations surfaced that a close confidant of Mr Mukesh Ambani was allotted Reliance Infocomm shares at a discounted price. A Reliance group statement dismissed the allegations a week later.

February was arguably the quietest month of the battle, save one significant development.

On February 8, Reliance Infocomm said the Government's security concerns arising from an improper caller line identification (CLI) was a "bogey," since over 40 per cent of international long distance calls do not have a correct CLI. The Government said it held a different view. One month later on March 7, following a Telecom Dispute Settlement Appellate Tribunal ruling three days earlier, Reliance Infocomm paid a penalty of Rs 150 crore to the Department of Telecom.

A week thereafter, the Government said it was examining Reliance Infocomm's share deals to see if any law was violated by the company when allotting three crore shares to three unlisted firms at Re 1 per share.

On March 23, news appeared of a likely settlement by the brothers after Holi. Then the line went quiet till April 23, when IPCL said that Mr Anil Ambani had ceased to be a director from January 20.

Two days later, Mr Amitabh Jhunjhunwala, Director, Reliance Capital, alleged the board was not informed of the company divesting its 50 per cent stake in Reliance Petroinvestments Ltd, a company co-owned with RIL and through which the group's 46 per cent stake in IPCL was held.

On April 27, the day of RIL's annual results, Mr Anil Ambani did not sign the accounts but gave a quote to the media, "you have got Reliance XI versus Anil Ambani."

On May 21, Mr Chidambaram said that the Ambani brothers were moving towards a settlement. By the month-end, Mr Anil Ambani had visited Reliance Infocomm headquarters, endorsing chances of settlement.

Eighteen days later, 3.3 million Reliance investors have an agreement blessed by Srinathji and an earthly hope that the truce holds.

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