21st March 2012,Wednesday
India's richest man and Chairman of Reliance Industries, Mukesh Ambani has embarked on a massive restructuring of his personal investments worth billions of dollars by setting up a holding company called Reliance Industries Holding Pvt Ltd. The idea is to reduce cross holdings and streamline the portfolio of Mr Ambani, a source close to the development said.
Mukesh Ambani has invested in a gas pipeline company Reliance Gas and Transportation Ltd, a Jamnagar-based power company Reliance Utilities and in Reliance Ports and Terminal Ltd which also handles handles crude import, petrochem exports needs of Reliance Industries Ltd.
All these companies, in turn, hold stake in various quoted and unquoted companies. As a first step, the investment division of Reliance Ports and Terminals Ltd will be hived off as a separate company. It will then be merged with Reliance Industries Holding Private Ltd. The source said a petition with the Gujarat high court has already been filed by Reliance Port and Terminals Ltd to demerge its investment division. The merger is effective from February 1 this year.
A similar exercise with Reliance Gas and Transportation Ltd and Reliance Utilities and Power Ltd is also expected in the coming months, the source said.
When contacted, a Reliance spokesperson declined to comment on the article saying all these companies are unlisted and private companies. Mukesh Ambani owns India's biggest private sector company Reliance Industries Ltd which is listed in the stock exchanges.
Apart from this, Mukesh Ambani has several companies which are owned 100 per cent by him. The source said the holding company will help synergise investments of all the companies and give tax breaks to the holding company on losses, if any.
What is interesting is that for the first time Reliance Port and Terminal Ltd has reported a Rs 12,300 crore impairment in its investment portfolio. The source said these losses are notional and before merging the investment division with the holding company, Ambani has decided to write the losses off. The losses have been made due to investments made in various listed and unlisted stocks, the source said. The RPTL's investment portfolio, worth Rs 10,200 crore after the write off, will be merged with the holding company, the source said.
India's richest man and Chairman of Reliance Industries, Mukesh Ambani has embarked on a massive restructuring of his personal investments worth billions of dollars by setting up a holding company called Reliance Industries Holding Pvt Ltd. The idea is to reduce cross holdings and streamline the portfolio of Mr Ambani, a source close to the development said.
Mukesh Ambani has invested in a gas pipeline company Reliance Gas and Transportation Ltd, a Jamnagar-based power company Reliance Utilities and in Reliance Ports and Terminal Ltd which also handles handles crude import, petrochem exports needs of Reliance Industries Ltd.
All these companies, in turn, hold stake in various quoted and unquoted companies. As a first step, the investment division of Reliance Ports and Terminals Ltd will be hived off as a separate company. It will then be merged with Reliance Industries Holding Private Ltd. The source said a petition with the Gujarat high court has already been filed by Reliance Port and Terminals Ltd to demerge its investment division. The merger is effective from February 1 this year.
A similar exercise with Reliance Gas and Transportation Ltd and Reliance Utilities and Power Ltd is also expected in the coming months, the source said.
When contacted, a Reliance spokesperson declined to comment on the article saying all these companies are unlisted and private companies. Mukesh Ambani owns India's biggest private sector company Reliance Industries Ltd which is listed in the stock exchanges.
Apart from this, Mukesh Ambani has several companies which are owned 100 per cent by him. The source said the holding company will help synergise investments of all the companies and give tax breaks to the holding company on losses, if any.
What is interesting is that for the first time Reliance Port and Terminal Ltd has reported a Rs 12,300 crore impairment in its investment portfolio. The source said these losses are notional and before merging the investment division with the holding company, Ambani has decided to write the losses off. The losses have been made due to investments made in various listed and unlisted stocks, the source said. The RPTL's investment portfolio, worth Rs 10,200 crore after the write off, will be merged with the holding company, the source said.
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