The Ambani saga
Dhirubhai Ambani was one of India’s great 20th century entrepreneurs. After his death, his sons, Mukesh and Anil, managed a relatively clean divorce and are picking up where their father left off
Dhirubhai Amabani (1932-2002) founded Reliance Commercial Corporation in 1958 to import yarn and export spices, working the license-raj system. In 1966 he moved up and built his first textile mill. To acquire capital for further expansion he took the company public in 1977 with great success. That capital was used to build a polyester yarn plant in 1982.
By that time, his two sons, Mukesh (born in 1957) and Anil (born in 1959) were ready to help him manage the growing company. Anil joined Reliance in 1983 as Co-Chief Executive Officer. A graduate of Wharton Business School, he managed the fund raising and marketing activities for Reliance. He pioneered many innovations in the field of Indian finance, including India's first forays into overseas capital markets with international public offerings of global depositary receipts, convertibles and bonds. In particular, he guided Reliance in its efforts to raise US$2 billion from overseas financial markets.
The father and sons team used a strategy of backward integration to steer the Reliance Group to its current status as India's leading textiles, petroleum, petrochemicals, power, and telecom company, with group revenues of $28 billion.
While both Anil and Mukesh Ambani worked together amiably for over a decade while their father was alive, the latter’s death in 2002 led to a falling out. The two brothers split the Reliance empire in 2005, with Mukesh getting Reliance Industries and Indian Petrochemicals (IPCL) and Anil obtaining Reliance Infocomm, Reliance Energy and Reliance Capital.
Anil Ambani then created the Anil Dhirubhai Ambani Group (ADAG) in 2005, after the split. It was in that same year that he bought a 51 per cent share in Adlabs, the film processing and theater company, laying the ground for his push into media. Anil is also present in telecommunications via Reliance Communications, of which he holds 66 per cent. A merger deal between South African telecom giant MTN and Reliance Communications was being considered last year. It was however called off due to disruption by Mukesh Ambani.
Losing this deal, which could have created a $70 billion telecom company also contributed to Anil Ambani’s fall in world personal wealth rankings. The 6th richest man in the world in 2008, he slid down to the 34th position according to the 2009 Forbes list of billionaires. However, he still remains the third richest Indian behind Mukesh Ambani and Lakshmi Mittal, with an estimated personal wealth of $17 billion.
