The Hindu Business Line : Ambanis burn the midnight oil to put a formal pact in place

MR Mukesh Ambani, Chairman, Reliance Industries Ltd, was pushing the deadline to wrap up the dispute with his younger brother, Mr Anil Ambani as he walked into Friday's late night meeting.

The meeting was one in a series of recent crucial parleys to carve up the country's largest private business conglomerate. The younger Ambani's deadline-to strike a final settlement by Tuesday- was not far either.

Besides the two brothers and a few of their respective key officials, the meeting at Seawind, the Ambani clan's residence in South Mumbai, was attended by their mother, Ms Kokilaben Ambani, and the mediator — the Chairman of ICICI Bank, Mr K.V. Kamath.

A formal announcement was not on the anvil as the meeting started though informed sources told the media that the settlement could happen "any time" but hinted at an outer timeframe of seven to 10 days for an official statement.

The elder Ambani and his family, along with his officials, were headed for a weekend in Goa to attend his close aide Mr Anand Jain's daughter's wedding.

Well past midnight, the participants were aware of the scheduled RIL board meeting for Saturday morning. The meeting, which was discussing final modalities of the agreement that was struck almost a week ago, revisited the earlier decision not to make a formal announcement till a reasonable headway was made in the execution of formalities, especially legal, pertaining to the settlement.

The marathon discussion ended at 4.30 a.m. on Saturday, with a formal agreement in place to divide the business group that accounts for 3.5 per cent of the country's GDP and 16 per cent of its exports.

And, true to the Ambani family spirit, both the brothers agreed that their mother should make the official statement defining the future course of her two sons.

Sources said she was integral to the peace process in the role of an elderly figure, but not as a pressure point nor from any strategy point.

The mother, sources added, had entrusted the peace process in the hands of Mr Kamath, who has had long years of personal ties with her late husband.

It must be mentioned that Mr Kamath's name as a mediator was suggested by Mr Anil Ambani and was accepted by his elder brother.

The dispute between the two brothers hit media headlines when Mr Mukesh Ambani made a statement on November 18 last year that there existed differences between the two within the "private domain."

The observers pointed out that the Ambanis have struck a reasonably speedy settlement, in exactly seven months, given the enormity of the dispute and what it involved, and especially in the context of other Indian corporate family disputes that have raged on for a longer time.

Informed sources said that the turning point, which hastened the settlement process, came on April 27 this year when the younger Ambani walked up to the waiting media just before RIL board meeting to consider annual financial statement, and said: "It is me against the Reliance XI."

That made all concerned realise that the dispute could spin out of hand even though the late Dhirubhai Ambani's implicit succession plan had placed Mr Mukesh Ambani firmly in saddle as the Chairman with extensive powers across the group.

The UPA establishment hastened the process with a warning that Reliance carried tremendous consequences to the country's interest.

As the curtain falls on what is easily the biggest dispute corporate India has seen, an insider said, the settlement honoured the wish of late Dhirubhai Ambani, the son of a school teacher, that RIL is "inviolable" and the larger petrochemicals business should not be divided.

REL board to meet today Anil Ambani-controlled Reliance Energy Ltd's (REL) board will meet on Sunday to discuss proposals to raise long-term resources through equity offering to fund business plans.

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