Mukesh and Anil Ambani once again at the negotiating table

By Vipin Agnihotri

I am sure that you are fully aware of the last time Mukesh and Anil Ambani negotiation across the table. It was in year of 2005, when their mother Kokila Ben oversaw the split of the Reliance empire between the two estranged brothers.

It has come into the notice of The India Street that both Mukesh and Anil Ambani are once again forced to come to the negotiating table. This time around it is the Bombay High Court that’s asking them to do so not Kokila Ben.

It is worth mentioning in this regard that few days back, Bombay High Court gave Ambani brothers a period of four month to negotiate the commercial details of a gas deal that was signed as part of the split two years ago.

According to highly placed sources, as part of the settlement, the Mukesh Ambani controlled Reliance Industries Limited would supply gas to the Anil Ambani controlled Reliance Energy’s proposed 7,000 MW power plant in Dadri, Uttar Pradesh.

The question now arises: What does it mean to the Ambani brothers? In my opinion, for Anil Ambani it validates the sanctity of the deal over which Mukesh Ambani has been dragging his feet. Point to be noted here is that if the gas price and terms of supply are sorted out, Anil Ambani can look forward to getting his mega project off the ground.

On the other side of the coin, for Mukesh Ambani the court order has precipitated a four-month delay in sewing up 37 per cent of the total supply from his gas wells in Krishna- Godavari basin, off the coast of Andhra Pradesh. This is quite important since production from the $ 6 billion investment is slated to commence next year.

There were some reports in the Indian media that Mukesh Ambani lobbied the government to hold a string of cabinet level meetings to approve Reliance Industries Limited gas pricing. The good news for Mukesh Ambani is that the court has not endorsed the pricing suggested in the original contract.

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