‘Love between brothers’: India’s richest man Mukesh Ambani helps sibling avoid jail

Mukesh Ambani is now Asia’s richest man, worth $54.3 billion, according to Bloomberg News. (AFP)
Updated 19 March 2019
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‘Love between brothers’: India’s richest man Mukesh Ambani helps sibling avoid jail

  • Ambani brothers Mukesh and Anil fell out spectacularly after their rags-to-riches father died in 2002 without a will
  • Anil would have been jailed if he failed to pay 5.5 billion rupees ($77 million) to Sweden’s Ericsson by Tuesday

MUMBAI: The epic feud between India’s Ambani brothers has taken a new twist with the older and now vastly richer brother paying a debt owned by his struggling sibling, helping him avoid jail.
Mukesh and Anil Ambani fell out spectacularly after their rags-to-riches father died in 2002 without a will, leaving them to fight for control of his Reliance Industries conglomerate.
With their mother acting as peacemaker, they eventually agreed to split Reliance, at the time India’s most valuable listed company, and to stay out of each other’s sectors.
Mukesh’s half has thrived while Anil’s has tanked. Mukesh, 61, is now Asia’s richest man, worth $54.3 billion, dwarfing Anil’s assets of some $300 million, according to Bloomberg News.
Mukesh and his family live in a 27-story luxury Mumbai skyscraper believed to have cost more than $1 billion to build and regularly referred to as the world’s most expensive home.
Anil’s Reliance Communications is believed to have debts of around $4 billion and started insolvency proceedings in February.
That same month his woes deepened when the Supreme Court ruled he would be jailed if he failed to pay 5.5 billion rupees ($77 million) to Sweden’s Ericsson by Tuesday.
Reliance Communications dropped a bombshell late Monday by saying that the debt had been settled — implying that none other than Anil’s big brother had paid the money, prompting a humbled thank you.
“My sincere and heartfelt thanks to my respected elder brother, Mukesh, and (his wife) 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,” said Anil, 59.
“I and my family are grateful we have moved beyond the past, and are deeply grateful and touched with this gesture,” he added in a statement.
Mukesh’s decision may not have been driven entirely by a desire to bury the hatchet, however.
Monday’s short statement did not say whether the payment was a gift or a loan but some Indian media reported that it may have been compensation for a deal between the two that recently collapsed.
Anil had hoped to offload his company’s telecom tower and spectrum business to his brother’s Reliance Jio for $2.4 billion.
But the deal, which hit regulatory hurdles and opposition from creditors, was confirmed dead by both companies on Tuesday.
It is also not the first time that the brothers have appeared to make up.
In 2011, they came together to dedicate a memorial to their father, and their mother Kokilaben declared the enmity over, telling reporters: “There is love between the brothers.”
But five years later the elder sibling sparked a brutal price war in the Indian telecom sector, launching his ultra-cheap Reliance Jio mobile network in 2016 — bringing Anil’s Reliance Communications to its current predicament.


Morocco’s sole oil refinery battles for survival

Updated 24 June 2019
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Morocco’s sole oil refinery battles for survival

  • SAMIR refinery was set up in 1959 by the Moroccan government and sold in 1997 to the Corral group
  • The firm was liquidated in 2016 after it was unable to honor some €4 billion

RABAT: Three years after it was liquidated for racking up billions of euros worth of debt, Morocco’s sole oil refinery and the one-time economic flagship is struggling to attract a buyer and survive.
A self-declared “national front” — comprising employees, economists and union leaders — is leading the charge to salvage refining company SAMIR, while a trade court desperately seeks a new owner.
They face a tough battle, including a court deadline of July 18 to seal the refinery’s fate.
The firm was liquidated in 2016 after it was unable to honor some €4 billion ($4.5 billion at current prices) in borrowing.
The refinery was set up in 1959 by the Moroccan government and sold in 1997 to the Corral group, a Saudi-Swedish enterprise that holds a majority stake of more than 67 percent.
Work at the refinery, which had a capacity of more than 150,000 barrels a day, had already wound down a year before it was dissolved.
But nearly 800 employees remain on the payroll, albeit on slashed salaries scratched together from company coffers and creditors.
The workers’ fate now hangs in the balance, according to staff representative Houcine El-Yamani, who has spearheaded efforts by the “national front” to salvage the facility.
“We have made tremendous efforts” to pressure the state into reviving SAMIR since work stopped in 2015 at the plant in Mohammedia, between Rabat and the economic hub Casablanca, El-Yamani said.
Such efforts include sit-ins and press conferences.
“We still have hope of finding a solution,” he added.
A “national front” report submitted last year to Moroccan authorities denounced the 1997 privatization of the refinery as a “big sham” and the sale to Corral as “totally lacking in transparency.”
“The Corral group did not respect any of the terms of the contract (including pledges to invest funds to develop the refinery), dragging the sole national refinery into an infernal spiral,” said the report.
The drop in global oil prices in 2014 affected SAMIR, but the “national front” says bad management was the main factor behind the firm’s woes, as debts mounted and attempts to satisfy creditors failed.
After its liquidation in March 2016 by a Casablanca court, a committee of trustees was set up to find a buyer and safeguard jobs for employees.
“Around 30 international groups showed an interest,” but nothing materialized, El-Yamani said.
The “national front” also said the government could have been more pro-active.
“In the absence of any government action, the refinery’s assets risk being sold to scrap by the kilogram,” the coalition of employees, economists and union leaders said in its report.
Minister of Energy and Mines Aziz Rebbah dismissed claims that the government has no interest in salvaging the oil refinery.
“We have nothing against it,” he said. “If a buyer comes forth we will examine the proposal,” he added.
Morocco is totally dependent on oil imports and the winding up of SAMIR’s operations has left the North African country more reliant than ever on imports of refined oil products.
A report earlier this year by the International Energy Agency noted that “the closure of the country’s only refinery... has clear implications for the security of oil supply” in Morocco.
The court that liquidated SAMIR three years ago has extended a deadline to keep the refinery open a dozen times.
The last extension expires on July 18, when SAMIR will know if it has a buyer or if it will be sold “in bits and pieces,” according to Moroccan media reports.