Ambanis finally agree to dump old pact, start afresh
24 May 2010
Ending years of often acrimonious dispute, the Ambani brothers – Mukesh and Anil – on Sunday agreed to set aside their differences and dump the 'non-compete' arrangements entered into between the two groups in January 2006, saying this would ''eliminate any room for further disputes''.
Announcing that they would also expeditiously negotiate gas supply agreement in accordance with the Supreme Court order earlier this month, the groups headed by Mukesh and Anil vowed to fulfil vision of their father Dhirubhai Ambani, after whose death they split up their business empire.
The announcement came within days of Anil Ambani meeting Prime Minister Manmohan Singh and other cabinet ministers.
Mukesh's Reliance Industries Ltd (RIL) and Anil's Reliance Anil Dhirubhai Ambaini Group (ADAG) have entered into a new, simpler non-compete agreement with respect only to gas-based power generation. The new agreement has been approved by the board of directors of the two groups.
RIL is mostly into old economy businesses that include refining, gas and power, while ADAG deals with new economy businesses like finance, entertainment and telecom.
The fresh agreement means that RIL can now enter into the financial services and telecom business, while Reliance ADAG can enter the refining business.
