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Since 1st March, 1999
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Mukesh calms market, not rift rumours
All big companies have to deal with several issues concerning corporate ownership of future initiatives. Reliance is no exception
Mukesh Ambani

Mumbai, Nov. 22: Five days after he ignited a firestorm of speculation about a split in the country's largest business house, Reliance chairman Mukesh Ambani tried to quell the concern that had welled up in the market.

Mukesh said today his remarks about 'ownership issues in the private domain' in a TV interview had been wrenched out of context.

Returning from the US last night, he issued a statement in which he accused the media of trying to build up a sensational story based on 'speculation and misrepresentation'.

The statement shored up Reliance group shares which began the day with a hammering, but rumours about Mukesh's differences with younger brother Anil refused to die down.

Mukesh claimed that his father, Dhirubhai Ambani, who died in July 2002, had 'settled all ownership issues pertaining to Reliance during his lifetime'.

This cryptic comment raised more questions than it sought to answer: it didn't categorically say whether Dhirubhai had left behind a will. If he hadn't (as the media had reported), it wasn't clear how the ownership issue had been settled within a Rs 99,000-crore group that uses a web of investment companies to control the family's holdings.

Mukesh also said his father had taken 'necessary steps to separate ownership from management' ' another phrase that appeared to be laden with meaning for people who have been trying to divine the goings-on behind the closed doors at SeaWind, the family fortress at Colaba.

The Reliance chairman ' reputed to have a combined wealth of Rs 27,000 crore with his brother ' clarified that he was talking about future businesses when he said there were 'ownership issues'.

'Reliance is engaged in diversification, acquisition of running businesses and creation of new assets. In such a rapid growth phase, all big companies have to deal with several issues concerning corporate ownership of future initiatives. Reliance is no exception,' the statement said.

Some reports said Mukesh had wanted to issue a joint statement with Anil in a show of unity, but the move had been scuttled from within the family. There was also no confirmation if the much-awaited family conclave had been held today in the presence of mother Kokilaben to settle rumoured differences between the brothers.

Anil attended office at Ballard Estate as usual. Amid speculation that Mukesh's statement may not have settled nerves on the other side, there were reports that Anil could issue a statement tomorrow.

As reporters huddled outside SeaWind early this morning, skittish punters dumped Reliance group stocks ' especially index heavyweight Reliance Industries. However, the mid-afternoon Mukesh statement talked up three stocks ' Reliance Industries, Reliance Capital and Indian Petrochemicals Ltd.

The fourth counter ' Reliance Energy, a company managed by Anil ' continued to lose ground.

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