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Telecoms agreement looks set to end family business feud

The ongoing feud between India's Ambani brothers may be coming to an end, as Mukesh and Anil are reportedly discussing a cooperation agreement in the telecommunications sector, raising speculations that they may reunite the family business founded by their late father Dhirubhai Ambani.
Ambani brothers
Associated Press

The ongoing feud between India's Ambani brothers may be coming to an end, as Mukesh and Anil are reportedly discussing a cooperation agreement in the telecommunications sector, raising speculations that they may reunite the family business founded by their late father Dhirubhai Ambani.

According to media reports, Reliance Industries, owned by elder brother Mukesh, 54, may lease telecoms infrastructure from Reliance Communications, controlled by Anil, 52, for the launch of its broadband and wireless internet services.

Anil’s company, which at the end of March had debts of about $7 billion (€5.1 billion), failed to rent its towers in recent months. A deal with Reliance Industries would boost the company’s troubled revenues and help it to reduce its debts.

An agreement between the Ambani brothers would also end India’s longest-lasting family feud, which started when Anil and Mukesh inherited their father's Reliance Group upon his death in 2002.

In 2005, the pair decided to split the company into two separate conglomerates, with Mukesh controlling Reliance Industries and Anil at the head of Reliance Anil Dhirubhai Ambani Group.

During the split it was agreed that Reliance Industries would supply below-market-price gas to Anil's company. Mukesh fought the agreement, but a court ruled in favour of Anil in June 2008 and the family agreement was upheld.

After the split, the two also signed a non-competition agreement that prevented each of them from entering the other brother’s industry. They later agreed to cancel the pact in 2010 and Reliance Industries was able to enter the telecoms and financial services businesses, in which Anil's companies have an important presence.

According to Forbes, Mukesh is worth approximately $27 billion while Anil's estimated worth is $8.8 billion.

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