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Tuesday, Jul 26, 2005

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Reliance board may consider de-merger plan tomorrow

Boby Kurian

Bangalore , July 25

THE board of directors of Reliance Industries Ltd, which is to meet on Wednesday to consider the quarterly results, is likely to approve the company's de-merger plan involving Reliance Infocomm, Reliance Energy and Reliance Capital, in line with the settlement reached between the Ambani brothers to carve up the business.

Informed sources said a detailed de-merger document to be placed before the board is being finalised, and if it fails to make it by Wednesday, the company's board could meet again within 10 days to approve the same.

It is learnt that the de-merger plan involves spinning off the three businesses that Mr Anil Ambani gets to manage as special purpose vehicles. Sources said the document in the making was not likely to contain any details of the settlement between the brothers since it was a private family affair.

Late last month, the two brothers decided to divide the assets of the Rs 99,000-crore Reliance group to end a simmering dispute between them. As part of the settlement, the elder brother Mr Mukesh Ambani will continue to hold the reins in the flagship Reliance Industries Ltd and IPCL, while the younger Ambani will gain control of new businesses such as Reliance Infocomm, Reliance Energy and Reliance Capital.

It is not yet clear who will be the new public face of Reliance Industries, a role which Mr Anil Ambani used to don, and present the financial statements to the media and analysts. It is certain that the Chairman, Mr Mukesh Ambani, is unlikely to be presenting the results, even as the names of several professionals are doing the rounds, with Mr Nikhil Meswani, who is related to the Ambani family, being the frontrunner.

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