Reliance Industries Tie-up with BP

by on February 22, 2011

Photo credit BEN STANSALL/AFP/Getty Images

One of the India’s largest foreign investments has been undertaken by the richest man in Asia. He is not just the chairman of India’s biggest listed Company but is also believed to live in one of the largest and most expensive homes in the world.

Mukesh Ambani, 53, with a net worth estimated at $29 billion is the world’s fourth richest man, a survey suggests. He is said to have struck a deal with BP on Monday as per which the British energy giant is due to pump at least $7.2 billion into gas projects which are developed by his Reliance Industries.

And as for BP the deal is the second one followed by share swap with Russia’s state-controlled Rosneft to which BP’s new Chief Executive Bob Dudley is said to have agreed to.

Reliance is likely to be paid performance payments of up to $1.8 billion, BP asserted, if the deal would result in development of commercial discoveries. Dudley is sure that BP was likely to gain as a result of the increasing energy demands in India.

A year earlier India had been captivated by a long-running family feud between Ambani and his younger brother Anil. Having driven the case to the Supreme Court, Ambani had later won the case.

This soft-spoken, vegetarian and a teetotaler is the elder son of Reliance Industries founder Dhirubhai Ambani who was a schoolmaster.

A classmate of Microsoft CEO Steve Ballmer, Mukesh Ambani is said to have dropped out of an MBA program at Stanford University. This chemical engineer by training had reportedly joined Reliance in the year 1981.

Later on when Dhirubhai Ambani died in the year 2002 the two brothers got into a conflict which further resulted in the split of the family business empire in 2005. This split was supposedly brokered by their mother and after the split; Mukesh was seen to take control of energy-based conglomerate Reliance Industries.

Anil then was seen to take over the power, telecoms and the infrastructure businesses.

The deal now which proves that Mukesh Ambani has been an ardent dealmaker is valued at about $70 billion. This deal with BP is likely to bring about a hike in the shares of Reliance Industries since it is due to bring in capital and technology.

“BP is the best finder of hydrocarbons in deepwater in the world”, said Mukesh Ambani.

Also he had reportedly struck three shale gas joint ventures in the United States last year. One of them was the deal he had struck with Atlas Energy to own 40% of its Marcellus Shale operations in the eastern United States. This deal was worth $1.7 billion.

{ 0 comments… add one now }

Leave a Comment

CommentLuv badge

This blog uses premium CommentLuv which allows you to put your keywords with your name if you have had 3 approved comments. Use your real name and then @ your keywords (maximum of 3)

Previous post:

Next post: