Mukesh Ambani bails brother out of jail trouble by paying dues

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MukeshAmbani bails brother AnilAmbani out of jail trouble by paying dues

NEW DELHI - Asia's richest man Mukesh Ambani has helped his younger brother avert a stint in jail, stepping in to make an US$80 million payment for his sibling Anil whose telecom-to-infrastructure empire is struggling under the weight of debt.

"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," he said in a statement from Reliance Communications. After they carved up the conglomerate, the older brother's oil and petrochemicals business flourished, while Anil Ambani's businesses ranging from telecom to power and infrastructure strained under massive debt, with the tycoon fending off creditors in multiple court cases.

The decline in Anil's wealth ranks among the largest and fastest implosions in modern history ranking alongside the reported US$70 billion loss Japan's Masayoshi Son suffered during the dot-com crash after SoftBank Group Corp.'s stock tumbled. Shares of RCom, as the telecom carrier is called, had slipped 9.1 per cent on Monday in Mumbai before the announcement.

PERSONAL GUARANTEE As regulations delayed the completion of his biggest deal, creditors such as Ericsson began demanding past dues. The Swedish equipment maker's relentless legal pursuit led to a settlement under which RCom was to pay half of the past claims, or 5.5 billion rupees - an offer backed by a personal guarantee from Anil Ambani.

 

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