By Mridang Lodha:
Down the pages of history, little did Mr Dhirubhai Ambani know that his brainchild, the Reliance group of industries and companies would emerge almost synonymous to his name. Building huge market capital and generating greater returns for the share-holders, the company since then has grown by leaps and bounds.
In the year 2005, a few years after the death of Mr Dhirubhai Ambani, the Ambani family could not stay away from the winds of conflicts and controversies, and finally after long and constant efforts by Kokilaben Ambani to keep the family together, Mukesh and Anil Ambani, settled for a Legal Split.
The split, I see for all the reasons has been good enough, and has not just helped the two brothers grow, but also everyone else associated directly or indirectly with the company; the Indian Economy, Shareholders, Investers, Partners and associates etc.
In India, things run and are based more on social norms and acceptance, than the practical aspect. And hence the fight between the two brothers was deeply condemned and received a lot of media attention along with unprecedented criticism. To a certain extent things did get worse, I agree. From two brothers who previously shared an impregnable bond, Ambanis rose to fight on issues as petty as phone bills for Co-Owned Companies, and also as big as the fight for the oil share in the country.
At very few instances in history will you find that both the parties involved in a cold war have reasons to rejoice. The Ambanis truly are an exception.
The fight, I believe has given more benefits than the problems it might have created. The split gave them a lot media attention and publicity, and any publicity is certainly good publicity, especially when it comes for free. Also, if you analyse the above table, you could easily mark the capital growth of the company, and the immense business it has done since the split. Also, the split also has made the brothers diversify their arena of influence and work. Anil Ambani will soon be venturing with Steven Spielberg, which is expected to roll out a lot of money abroad as well as back in India.
In case the two brothers overcome their differences and decide on a merger, they probably would come up with a company incomparable to any in India; for they would have influence is almost all possible sectors of the Indian Economy, from food to fibres, form medicines to movies, and from oil to ornaments.
If I were to suggest someone a diversification and growth plan, probably the Ambani Split would be on the top of my list, planned and structured with a merger anytime in future.
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