Striking a cordial note, the warring Ambani brothers on Sunday agreed to dump their differences and strike out contentious non-compete agreements 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 of both Mukesh and Anil vowed to fulfil vision of their father Dhirubhai Ambani, after whose death they separated after an acrimonious fight.
There were speculations that the agreement, approved by the board of Mukesh-led RIL and Anil Ambani Group, came after the two brothers had discussions between them but spokespersons of either did not confirm the same.
The announcement came within days of Anil Ambani meeting Prime Minister Manmohan Singh as also top Cabinet ministers. His visit was followed closely by Mukesh who also met top ministers as also government functionaries.
Before the agreements were ratified, the boards of the respective group companies, top officials of the Mukesh Ambani-led Reliance Industries and Anil Ambani Group had long sessions.
Sources said the discussions were spurred by the Supreme Court directing the two groups to renegotiate their gas agreement within the frame work of government policies and prices. As a goodwill gesture, RIL said that it would not enter the gas-based power generation arena till 2022, for which two sides would enter a separate agreement. In identical statements released at the same time, both said, "RIL and Reliance ADA group are hopeful and confident that all these steps would create an overall environment of harmony, cooperation and collaboration between the two groups, thereby further enhancing overall shareholder value for shareholders of both the groups".
"All existing non-compete agreement between the two groups executed in January 2006 cancelled," Anil Ambani group said in a statement.
"A new, simpler non-compete agreement executed limited to only gas-based power generation. RIL (Mukesh) and RNRL (Anil) will expeditiously negotiate gas supply arrangement as per the Supreme Court order and hope to conclude negotiations very soon," it added.
The cancellation of the existing non-compete agreement will provide enhanced operational and financial flexibility to both groups and greater ability t participate in high growth sectors such as oil and gas, petrochemical, telecom, power and financial services, the Anil Ambani Group said.
These developments will eliminate any room for further disputes between the two groups, on matters relating to the scope and interpretation of the non-compete obligations, RIL added.
"RIL and Reliance Natural Resources (RNRL) will expeditiously negotiate gas supply arrangements in accordance with the orders of the Hon ble Supreme Court of India. We hope to conclude these negotiations very soon, the RIL statement further said.
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, the RIL statement added. PTI
