Legendary industrialist Dhirubhai Ambani’s younger son Anil Ambani was poised to achieve unprecedented success after the highly-publicised family business split of the Reliance’s massive business empire. His elder brother Mukesh Ambani got the legacy businesses while Anil had the businesses looking into the future with seemingly much bigger prospects. By 2008, Anil Ambani had overtaken his brother in terms of wealth, and was positioned as the sixth richest person in the world with a net worth of $42 billion.
15 years since then, Mukesh Ambani has reached unparalleled heights becoming Asia’s richest person. On the other hand, Anil Ambani has seen his fortunes turn for the worse, leaving him in a situation where he famously stated that his net worth was now zero around three years ago. Mukesh Ambani, on the back of phenomenal success in retail and digital ventures has seen his net worth skyrocket to Rs 7,49,357 crore ($90.1 billion). Reasons behind the downfall of Anil Ambani’s empire have often been the stuff of speculations and market analysis.
From earning $30 billion in a year to filing for bankruptcy, Anil Ambani was unable to live up to the early promise. The first big setback was arguably the proposed business deal with MTN, the South Africa-based telecom company. Anil Ambani’s Reliance Communications was the leading mobile service provider in India at one time. But he had to go for a merger with MTN amid soaring debts. The idea was to overcome the debt burden and build a big and strong company. But the deal fell through amid legal issues.
The next big hit to Anil Ambani’s business empire came in the face of the 2G scandal in 2011. Top executives were arrested on suspicion of conspiracy and the billionaire businessman was also questioned. The matter also hit share prices of his companies, seriously impacting his net worth.
Amid crunching debts and scandals hurting business, Ambani made another funding push with a $1.2 billion loan on a personal guarantee from Chinese banks. It did not revive fortunes and the list of lenders awaiting payments from Ambani just increased.
Ambani further faced the biggest challenge in the market with the entry of Mukesh Ambani in the telecom sector in 2016. Jio’s fortunes soared while Ambani’s Reliance Communications’ saw its market share plunge to just 2 percent from where it stood 3 years ago. Batting on multiple fronts, he was also forced to sell assets of Reliance Power. Multiple failed attempts to emerge from the debt crises meant that Anil Ambani was left without firepower to challenge rivals.
