At first glance, the merger Anil Ambani has proposed between his Reliance Communications and the South African MTN looks un-Ambani-like. Throughout his long reign, his father, Dhirubhai Ambani, was king. He never shared power. Dhirubhai Ambani had a way of doing business, and he wanted to do it his way. It involved choosing a strategic direction, concentrating resources on it, and achieving a commanding position. First it was polyester, then fabric, then oil refining; in each, Reliance left its rivals far behind.

This is the tradition Mr Anil Ambani is breaking with. So there must be a good reason. It has to be found in his troubles with his elder brother, Mukesh. Ever since their father died, the two brothers have been squabbling, and their eventual parting was bitter. His brother is the first burden that Mr Anil Ambani must carry; but not the only one. Reliance Communications is a distant third in telecommunications, behind Airtel and BSNL. In an industry where network economies favour size and spread, it is difficult for Reliance to catch up. Further, the urban cellphone market is nearing saturation. After that, it will be a game of setting up many towers to gain a few rural cellphone users. It will be difficult to collect dues from them, so companies will mostly sell prepaid cards. Prepaid cards create no loyalty; a villager will buy one company’s card one day and another’s the next. So Mr Anil Ambani faces a drastic fall in margins in the domestic market. He must also be fed up with working in India.

There is the perpetual worry about what Mr Mukesh Ambani will be up to next. In addition, there are the headaches of keeping the government out of his hair. A merger with MTN is a good way of getting out of these troubles. Reliance Communications will be swallowed in MTN, which will be a London-based company. Its markets abroad will alleviate the risks of operating in India and under its government. The combination will be much larger and will have a correspondingly bigger kick; Mr Mukesh Ambani will find it more difficult to pull its tail. Which is why, characteristically, Mr Mukesh Ambani has tried to put a spoke in his brother’s wheel: Reliance Industries has sent a notice to Reliance Communications claiming right of first refusal. It may satisfy some instinct, but it is terrible publicity for Mr Mukesh Ambani and Reliance Industries.