Mukesh and Anil Ambani, who have been estranged for several years, are currently mulling a partnership in the telecom industry, according to the Financial Times citing people close to the matter.
It has been suggested that the agreement, which would see…
Mukesh and Anil Ambani, who have been estranged for several years, are currently mulling a partnership in the telecom industry, according to the Financial Times citing people close to the matter.
It has been suggested that the agreement, which would see Mukesh Ambani’s Reliance Industries use the telecom tower infrastructure owned by Anil Ambani’s Reliance Communications, may be the first step towards the two brothers deciding to merge their groups.
Following the death of their father, Indian business magnate Dhirubhai Ambani, in 2002, the group was split between the two brothers. But in 2005, a dispute over the supply of gas between the two companies meant the brothers stopped talking to each other.
Conglomerate Reliance Group owns Reliance Communications (Rcom), India’s second-largest telco in terms of customers. It is also present in the financial services, energy, infrastructure, entertainment and health sector.
Reliance Industries focuses mainly on petrochemicals, oil & gas, textile and retail. It also owns Infotel Broadband, the only company that secured a pan-Indian BWA licence in 2010.
According to the Financial Times, a deal between the two companies would allow Reliance Industries to launch broadband and wireless internet services.
As for Reliance Group, this agreement would be a welcomed new source of revenues. RCom has been faced with mounting liabilities of approximately US$7bn.
Last year, it was hoped that an US$11bn tower deal with GTL would allow it to cut its debt. But the deal collapsed on alleged valuation differences. Since then, RCom has been looking to sell its tower business, Reliance Infratel.
The companies were not available for comment before going to press.
