New Delhi: India's billionaire Ambani brothers took a step towards reconciliation of their long-running feud on Sunday, ending non-compete agreements in a step they hoped would lead to cooperation between the two groups.
Both groups said they hoped to reach a conclusion soon in a gas supply agreement between Reliance Industries (RIL) and Anil's Reliance Natural Resources that had been at the heart of their dispute.
"RIL and Reliance ADA Group are hopeful and confident that all these steps will create an overall environment of harmony, co-operation and collaboration between the two groups, thereby further enhancing overall shareholder value for shareholders of both groups," both companies said in statements.
The announcement comes weeks after India's highest court ruled in Mukesh Ambani's favour in a bitter dispute over gas pricing that had made headlines, riven India's richest family and raised questions about the influence of big business on government policy.
On Sunday, Reliance Industries and Anil's Reliance ADA Group said they had agreed to cancel all existing non-compete pacts which the groups had signed in 2006 and entered into a new and simpler non-compete pact only for gas-based power generation.
"If you weigh the positives and negatives, this is more positive for Reliance Industries than R-ADAG group, because this gives Reliance an opportunity to look into expansion in other areas, which they were not allowed to do earlier," said S.P. Tulsian, an independent investment consultant.
"You can't rule out the possibility of Reliance entering in sectors such as telecom," adding the Reliance shares are expected to open up on Monday, in the wake of this development.
The two brothers, who both live in Mumbai but had not been on speaking terms during their dispute, inherited their business empires from their father Dhirubhai Ambani in 2005.
Mukesh got the jewel – Reliance Industries, which has interests in oil and gas exploration, petrochemicals, infrastructure and textiles. Anil got the telecoms, power and financial services businesses.
