Formalisation of Ambani settlement may start in six weeks

Formalisation of Ambani settlement may start in six weeks
New Delhi, June 5 (PTI) The broad contours of a settlement in the ownership battle between Mukesh Ambani and younger brother Anil are understood to have been worked out and are expected to be formalised within the next six weeks.

The first of the announcements about the settlement could be made between four and six weeks although restructuring of group companies and legal formalities could take six months.

Being keenly watched by the government, the settlement process has made speedy progress during the last one month to end the fiercest battles in the country's corporate history, knowledgeable sources said today.

As part of speeding up the progress, Kokilaben, widow of the founder chairman of Reliance Dhirubhai Ambani, is meeting the two brothers separately almost on daily basis, they said.

Contrary to media reports about the confusion over who would get Reliance Capital, the sources indicated that the company operating in the market is set to go to Anil along with Reliance Energy and Reliance Infocomm, headed by Mukesh.

As per the broad understanding, new businesses of Reliance group that came into existence in the last few years would go to younger brother Anil while the parent company RIL and petrcochemcial venutre IPCL would be retained by Mukesh. Possibilities of a merger between RIL and IPCL in future could also not be ruled out.

Keenly watching the progress on the largest corporate house in the country, Finance Minister P Chidambaram said last fortnight that the two Ambani brothers were moving towards settlement and there was no need for any government intervention in the family dispute.

Even as the negotiations are in full swing, movement of top executives within the group has already started. Some of the close lieutenants including Manoj Modi have already moved away from Reliance Infocomm.

Most of the executives who had opted to work with Mukesh Ambani both in Delhi and Mumbai have been absorbed in the parent company RIL's new oil and gas business, sources said, indicating that Manoj Modi is getting into retailing business like setting up of petrol pumps and a new venture or retail outlets on the lines of US retail giant Wal-Mart.

The group's HR Chief V B Bhatt had asked the top executives of Infocomm in April itself to make their choice clear on whether they would like to revert to parent company or continue in their present position in case the company, headed by Mukesh, goes to Anil.

Along with this RIL had provided a few weeks ago details of borrowings and other financial parameters to younger Ambani to enable him make an assessment of the company, sources said, adding that a broad evaluation of the companies by Anil's team is in advance stages of completion.

These developments follow Kamath's recommendations a few months ago that one brother keep RIL and IPCL while the other gets REL, headed by Anil, along with Reliance Capital and Infocomm.

In his report, Kamath aided by investment banker Nimesh Kampani of J M Morgan Stanley for evaluation of group companies and family assets, is reported to have fixed a value to about Rs 25,000 crore for Infocomm and upto Rs 800 a share for RIL equity, an issue that dominated the negotiation process.

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