Brother of all bailouts saves Anil just in time
Blood is thicker than loose change.
Anil Ambani on Monday averted a possible jail term by clearing dues totalling Rs 550 crore with Ericsson and publicly thanked elder brother Mukesh Ambani for the “timely support”.
The apparent bailout and expression of gratitude marked extraordinary moments in a riveting corporate and family saga that has intermittently held the country spellbound for more than a decade.
“My sincere and heartfelt thanks to my respected elder brother, Mukesh, and Nita for standing by me during these trying times, and demonstrating the importance of staying true to our strong family values by extending this timely support. I and my family are grateful we have moved beyond the past, and are deeply touched with this gesture,” Anil said in a statement issued through the spokesperson of his group.
Anil made the payment to Ericsson, the Swedish telecom company, a day before the deadline set by the Supreme Court was to expire. Failure to pay the dues, run up while Ericsson was operating Anil’s Reliance Communications (RCom) network, could have invited contempt action and landed the industrialist in jail.
From Anil’s statement, it looks like Mukesh, the richest Indian, has chipped in for his kid brother — 15 years after the elder brother had confirmed whispers of a rift between the siblings by conceding there were “ownership issues”.
In 2005, the assets were divvied up between the brothers. The core energy business went to Mukesh while Anil’s kitty included telecom, financial services and power. While Mukesh grew from strength to strength, Anil eventually slipped into the quicksand of debt.
Talk of the stirrings of rapprochement did arise occasionally. Mukesh was supposed to buy Anil’s telecom assets and bail him out but the deal failed to go through because of regulatory hurdles, and Anil was unable to clear his dues with Ericsson as scheduled.
On Monday, soon after making the payment, Anil’s RCom announced the termination of the Rs 17,000-crore deal to sell the telecom assets to Mukesh’s Reliance Jio, citing delays in approvals from the government and lenders.
An Ericsson spokesperson confirmed that the company had received a balance payment of Rs 458.77 crore (principal amount) from RCom on Monday. Together with the Rs 118 crore it had previously paid, RCom has cleared all dues, including interest.
An amount of Rs 458 crore is small change for the richest Indian whose wealth in 2018 was put at Rs 3.71 lakh crore. Not to mention Antilia, the house that Mukesh has built at an estimated cost of Rs 6,000 crore.
The opulence of the Ambanis was in the news recently during the weddings of Mukesh’s daughter and son. Anil was present at the events.
The payment of the dues is certain to draw fresh attention to the Rafale scandal as Anil’s company is one of the offset partners of Dassault, the French manufacturer of the fighter aircraft.
Lawyer Dushyant Dave, representing Ericsson, had said in the Supreme Court: “They have money to invest in Rafale but cannot pay us our Rs 550-crore dues…. Somebody who cannot pay Rs 550 crore to us is there in every conceivable deal.”
That it took Big Brother to bail Anil out is likely to be seized by the Opposition to raise fresh questions on the Rafale deal.