Mukesh Ambani – The South Asian Billionaire
Mukesh Dhirubhai Ambani was born on 19 April 1957 to Dhirajlal Hirachand Ambani and Kokilaben Ambani, in the British Crown colony of Aden.
The Birth Of Reliance Commercial Corporation
In 1958, as the political situation in Aden worsened, Dhirajlal, popularly known as Dhirubhai, returned to Mumbai, India with his family. Here, he partnered up with his cousin, Champaklal Damani, to export spices and fabrics. This partnership was the birth of the Reliance Commercial Corporation.
In Mumbai, Mukesh Ambani continued his studies and at the Hill Grange High School, he befriended Anand Jain, who later became his close business associate. After receiving a BE degree in Chemical Engineering from the Institute of Chemical Technology, Ambani enrolled for an MBA at Stanford University.
Soon after, in 1980, the young prodigy withdrew from the program after his father called him back to India. Dhirubhai’s company was expanding its polyester yarn business by setting up a Polyester Filament Yarn Plant in Maharashtra and he wanted his son to take control of the project.
This backward vertical integration allowed the now renamed Reliance Industries Ltd to own its suppliers and consequently, generate more revenue and improve its competence. Meanwhile, young Mukesh groomed himself under the supervision of Rasikbhai Meswani, then executive director of Reliance Industries.
He married Nita Dalal in 1985 after his father attended a dance performance in which she took part in. Impressed by her performance, Dhirubhai came up with the idea of arranging a marriage between the two. The couple gave birth to two sons: Anant and Akash, and a daughter, Isha.
His Father Suffered From A Stroke
In 1986, Dhirubhai Ambani suffered from a stroke that left his right hand paralyzed. Following the tragic incident, the day-to-day oversight of Reliance was handed over to Mukesh and his brother, Anil Ambani.
By 1992, the company had scaled up its installed capacity for producing polyester yarn by over 145,000 tons per year. In the same year, its subsidiary, Reliance Petrochemical Limited commenced the production of high-density polyethylene (HDPE) at Hazira.
Reliance Industries had now officially effectuated a complete backward vertical integration. The company, along with its subsidiaries, was now producing petrochemicals, making polyester fibers out of them, and then manufacturing textiles as the finished product.
By the turn of the century, Reliance Industries and its group of companies had effectively penetrated the telecommunications and healthcare industries and its total asset valuation had crossed INR 50,000 crores!
Expanding The Business
Furthermore, with the commissioning of the crude oil refinery in Jamnagar, India, Ambani had officially directed and led the creation of the world’s largest grassroots petroleum refinery with an installed capacity of 668,000 barrels per day.
Perhaps the most pivotal year in the life of the Indian billionaire was 2002. This was the year when the largest ever merger in India took place between Reliance Petroleum Limited and Reliance Industries. Soon after, Reliance Industries becomes the first Indian private sector company to announce a natural gas field discovery, the world’s largest at that!
Reliance Infocomm Limited
In the same year, Mukesh Ambani set up Reliance Infocomm Limited to focus on information and communications technology initiatives in India. The company would soon become Reliance Communications Limited and revolutionize the telecom landscape of India.
While 2002 saw RIL thriving, Ambani suffered a severe personal blow when his father, Dhirubhai Ambani, died at the age of 69 leaving behind no will for the distribution of perhaps the greatest business empire the world had ever seen.
He Becomes Chairman And MD Of Reliance Industries Ltd
Following his father’s death, Mukesh Ambani became chairman and managing director of Reliance Industries Ltd, with his brother Anil appointed as vice-chairman. Sadly, however, the two Ambani brothers started quarreling over their father’s sizeable fortune and massive corporate holdings due to the absence of a will.
Following the purchase of Germany’s Trevira in 2004, RIL became the world’s largest polyester manufacturer, with production levels topping 25 million meters per year. The oil tycoon continued expanding the company and further scaled up its installed capacity for producing polyester staple fibers, polyester filament yarns, and polyester chips.
The dispute culminated in Mukesh and Anil’s mother Kokilaben brokering an agreement between the brothers. Consequently, in 2005, Reliance Industries was split in two with Mukesh taking over the old businesses (oil and the chemical section of the company) and Anil took over the new businesses (the conglomerate’s telecom, power, natural resources, and financial-services business)
Following the de-merger of 4 businesses from RIL, the Indian billionaire laid his eyes upon the organized retail segment of India. He formed Reliance Retail and opened up the first Reliance Fresh store in Hyderabad in 2006.
2007 saw the telecommunications company, Reliance Jio, being incorporated as a subsidiary of Reliance Industries. With company profits and net assets reaching all-time highs, Mukesh Ambani topped the global rich list in October of the same year.
Next, the Indian billionaire acquired the Mumbai Indians franchise in the Indian Premier League for $111.9 million in 2008. In 2010, Reliance Industries acquired Infotel Broadband Services Limited, which was the only successful bidder for pan-India fourth-generation (4G) spectrum auction held by the government of India.
Ambani Accused Of Inflating Prices
The oil tycoon was accused of irregulating the price of natural gas from the KG basin in 2014. The First Information Report (FIR) alleged that Reliance Industries had inflated the price of gas to eight dollars a unit even though the cost of producing one unit was only one dollar which meant an annual loss of Rs. 540 billion to the country. The company, however, denied all accusations.
Ambani’s promise to launch 4G broadband services in India came to fruition in 2015 when LYF is established by Reliance Jio as a mobile handset company to manufacture 4G-enabled VoLTE smartphones that run on Android. Reliance Jio soon becomes the only company in India capable of providing 4G services in the country when it launched its services in 2016.
Bailing Out His Brother
In 2019, a court in Mumbai held Anil Ambani in criminal contempt for non-payment of a personally guaranteed debt that Reliance Communications owed to Swedish gear maker Ericsson. When Anil was unable to pay back the debt, Mukesh came to the rescue and bailed out his younger brother by paying it for him.
As of 2020, the oil-to-telecom conglomerate of Reliance Industries is ranked 96th in the Fortune Global 500 list. The Indian billionaire, Mukesh Ambani who leads the company is currently the 10th richest person in the world (2023) with a net word of $90.7 billion USD according to Forbes Billionaire List.
The Ambani brothers had fallen out after the passing of their father. Mukesh Ambani has managed to build up his share of the fortune, whilst his brother Anil Ambani has suffered major losses.
Mukesh Ambani is reported to have spent $100 million USD on his daughter Isha Ambani’s wedding. There were many high profile guests including Ratan Tata, bollywood stars and politicians present.
The global network and influence created by Mukesh Ambani reflects his position as the 10th wealthiest person in the world. Although his is not a rags to riches story, he has managed to massively expand the business empire passed onto him by his father.