Eleven years ago, Anil Ambani was one of the richest men in the world. According to Forbes' assessment, the youngest son of industrialist Dhirubhai Ambani was ranked in 2008 as the sixth highest richest person in the world. Right after a decade, he is now fighting to save his reputation.
On Friday, the National Companies' Appeals Tribunal (NCLAT) rejected a request to order a group of lenders led by the State Bank of India (SBI) to release Rs 2,000 in tax refunds to Reliance Communications . In particular, the amount should be paid to Ericsson for which the Swedish multinational network and telecommunications company has appealed to the Supreme Court (SC).
The judgment is a huge setback for Reliance Communications, led by Anil Ambani. According to instructions from the Supreme Court, the comet is required to pay Ericsson its remaining dues of 453 million rupees by Tuesday to ensure that Ambani is not sentenced to prison. RCom cleared partial subscriptions of Rs 118 crore from the total of Rs 571 crore.
How did one of the richest men in the world manage to complain? Let's find out.
After the death of his father, Dhirubhai Ambani, Reliance Industries was split in two in 2005 and Mukesh Ambani, his older brother, took over the flagship oil refining and petrochemicals business. Anil found new companies, such as power generation, financial services and telecommunications, which had strong growth potential. From then on, the companies run by Anil Ambani started to borrow heavily to diversify and create a conglomerate that could generate as much wealth as the refining company Reliance Industries of Mukesh has created.
Ericsson case: Anil Ambani guilty of contempt of court, sentenced to pay a crore of 453 Rs or to three months in prison
The commander of the Anil Ambani police came out rather well until 2010, when a non-compete clause between him and his older brother was removed, which prevented Mukesh Ambani to enter the telecommunications market. In fierce competition in the growing telecommunications market, RCom continued to borrow to stay in the fight. RCom began to lose its number two position in the telecommunications market, an even greater acceleration when Reliance Jio, led by Mukesh Ambani, entered the market and completely disrupted it with free calls and data.
Today, Anil Ambani faces an arrest for non-payment to the Swedish equipment supplier of telecommunications equipment. The comr has offered to settle the case but since last year, things still do not seem to be successful. Only time will tell the fate of Anil Ambani.