Ambani brothers to split: Report

Last updated on: January 07, 2005 00:39 IST

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The Ambani brothers, engaged in a battle for ownership of the Reliance Group, have decided to split, a television channel reported on Thursday. Aaj Tak said the decision was taken when the entire family, including mother Kokilaben Ambani and sisters Dipti Salgaocar and Nina Kothari, gathered at their residence in south Mumbai [ Images ] on December 28 to mark RIL [ Get Quote ] founder late Dhirubhai Ambani's [ Images ] birth anniversary. Kokilaben Ambani and ICICI Bank [ Get Quote ] chief K V Kamath [ Images ] helped settle the issue, the channel said. The group's flagship company, Reliance Industries Limited, would not be split but restructured in a manner that will keep the brothers from stepping on each other's toes.

Mukesh Ambani admits to differences with Anil

When contacted, a RIL spokesperson said that the report is pure speculation and the company would not like to comment. He was not aware of any restructuring in the company and also pointed out that he represents the company, not the Ambani brothers. Reports of differences between the brothers had been the doing the rounds for some time but gained credibility in November 2004 when elder brother Mukesh admitted to the same while talking to CNBC TV 18 channel. Since then, the issue has received extensive media coverage. On Wednesday January 5, the Ambani brothers traded fresh accusations, in the name of the company's shareholders numbering about three million. Anil Ambani [ Images ], vice-chairman of RIL, made public yet another instalment of the proposals he had mooted at the December 27 board meeting, which had solidly backed his brother and RIL chairman, Mukesh Ambani [ Images ]. Anil, through his spokesman, said that in a presentation to the board, he had proposed that 12% equity of RIL held by the company's Petroleum Trust and four companies, whom he did not name, be distributed free among the shareholders. Ignoring this, the board had, instead, approved Mukesh's proposal for buyback of shares.

Sources close to Mukesh responded by saying it was Anil who had suggested, when the merger of RIL and Reliance Petroleum [ Get Quote ] Limited took place in 2002, that the 12% stock be kept as treasury stock. Anil had suggested at the December 27 board meeting that the maximum price for the buyback of shares should be only Rs 450 against the chairman's figure of Rs 570, which was approved by the board, they said. Revelations like these have drawn intense scrutiny - from investors, business associates/rivals and regulatory bodies - to the working of the company. The Securities and Exchange Board of India has asked RIL for a detailed briefing of the decisions taken at various board meetings in the last couple of years and specifically to classify the various decisions the company thinks are of a price-sensitive nature. On Thursday December 6, Anil Ambani met Finance Minister P Chidambaram [ Images ] in Delhi [ Images ]. It was not immediately known as to what they discussed. He had then met Prime Minister Manmohan Singh [ Images ] and handed over a donation of Rs one crore to the PM's Relief Fund, for tsunami affected persons. The brothers have avoided speaking to the media directly about their ongoing battle.