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| Mukesh to detail growth plans today |
| Press Trust Of India / New Delhi Jun 18, 2010, 00:40 IST |
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Within days of a truce with younger brother Anil, Asia’s richest man Mukesh Ambani will address shareholders of Reliance Industries tomorrow and is expected to announce mega investment plans, possibly in power and telecom sectors.
The cash-rich company has its options open to enter telecom, power and finance sectors that were hitherto no-go areas as spelt out in a separation agreement between the two brothers on June 18, 2005.
The non-compete pact was scrapped last month as part of a truce reached shortly after the Supreme Court verdict, denying cheap gas to Anil Ambani-led Reliance Natural Resources Ltd (RNRL) from Mukesh-run Reliance Industries Ltd (RIL) on the basis of a family agreement.
The bonhomie has also led to speculation that RIL may pick minority equity in three companies, including Reliance Communications, led by Anil and that younger Ambani, along with his wife, Tina and mother Kokilaben, would attend the RIL AGM tomorrow. Mukesh, 53, may use his address to RIL shareholders at Mumbai’s Birla Matoshree auditorium, the first after the Supreme Court judgment on the bitter gas dispute, to spell out how the $2-3 billion of surplus cash the company is generating every year will be put to use.
.jpg "Mukesh Ambani") Friday also marks five years to the day since matriarch Kokilaben Ambani brought about a family settlement, dividing the Reliance group empire between the two brothers. What is keenly watched is whether Mukesh will make any comments on the dispute over pricing and supply of gas from RIL’s KG-D6 fields to the Anil Ambani Group’s power plants.
Mukesh has so far not made comments during the four-year long gas dispute. RIL’s statement issued after the Surpeme Court judgment too did not have any comment from Mukesh on the row. He may, however, not say much on RIL entering into a new gas sales and purchase agreement with Anil’s RNRL as had been ordered by the apex court. Under the 2005 agreement that split the Reliance empire created by Dhirubhai Ambani, Mukesh, kept the petrochemicals, oil and gas units. Anil got the power, financial services, telecommunications, and entertainment units. The two last month scrapped the accord drawn up the following year that barred them from expanding into each other’s businesses. Mukesh is likely to talk about the oil refiner and energy explorer’s entry into telecom through the acquisition of an Internet service company for over $1 billion. He may also indicate the company’s willingness to enter commercial power generation by bidding for the government’s planned ultra mega power projects in Orissa and Chhattisgarh.
Besides diversification plans, the AGM may spell out RIL’s overseas ambitions. After a failed bid to buy bankrupt chemical maker LyondellBasell Industries AF for $14.5 billion and losing out on a bid for Canadian firm Value Creations. RIL, in April acquired 40 per cent stake in shale gas assets of Atlas Energy Inc in the US.
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