Reliance empire splits
The Reliance logo stays with Mukesh Ambani while brother Anil will now have to look for new one for his companies. This was the ultimate message reaching from Mumbai as Mukesh and Anil Ambani resolved their turbulent and public struggle on Saturday.
The nearly year-long feud for the division of the Reliance group companies ended in the early hours with Kokilaben Ambani issuing a statement making the separation official. "With the blessings of Srinathji, I have today amicably resolved the issues between my two sons, Mukesh and Anil, keeping in mind the proud legacy of my husband, Dhirubhai Ambani," the statement said.
Two Ambani companies
In effect, it means RIL will be split in two parts. One, the operational company in verticals like exploration and production, petrochemicals, refineries and marketing, will be controlled by Mukesh.
The new entity formed after the vertical split of RIL — proposed to be called Ambani Enterprises — will be primarily a holding company which will own all the holdings of RIL in different companies like Reliance Energy, Reliance Infocomm, Reliance Capital and other companies that will go to Anil.
While the official announcement was on expected lines, Kokilaben's statement further stated that Mukesh will have "responsibility" for Reliance Industries and IPCL while Anil will have "responsibility" for Infocomm, Reliance Energy and Reliance Capital. The word "responsibility", however, leaves the critical aspect of ownership and control in the dark.
Over to a committee
The RIL Board has decided to authorise the corporate governance and stakeholders' interface committee to examine in depth all the relevant issues, including statutory and legal requirements, and suggest a reorganisation scheme. In this task, the board further empowered the committee to avail of professional and legal expertise in preparing the reorganisation scheme, the release said.
Y.P. Trivedi, D.V. Kapoor and M.P. Modi, independent directors on the RIL board, would be members of this committee, said sources.