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In June, Indian billionaire Mukesh Ambani and his aides encountered an unexpected dilemma when debating where to train his empire’s dealmaking lens.
Ambani’s Reliance Industries Ltd. was considering buying a foreign telecoms giant, but Gautam Adani, who overtook Ambani as Asia’s richest man a few months ago, was the first to launch 5G spectrum in India. Word reached them that they were planning to bid on a large sale. For those in the know.
Ambani’s Reliance Jio Infocomm Ltd. is a top player in the Indian mobile market, but Adani Group does not even have a license to provide wireless communication services. But the very idea that he might be circling the Earth, at the heart of Ambani’s ambitions, has put Ambani’s camp on high alert, said the people, who asked not to be identified as they discuss undisclosed information. an official said.
One adviser advised Ambani to pursue overseas targets and diversify beyond the Indian market, while another advised him to seek funding to fend off challenges at home, according to people familiar with the matter. advised to save
Ambani, who has a net worth of nearly $90 billion, did not end up bidding for the foreign firm, which has reached $118.3 billion, according to data from the Bloomberg Billionaires Index, said a person familiar with the matter.
Asia’s two richest men are increasingly on the same page after more than two decades of peaceful expansion in their respective fields.
billionaire dynasty
This is setting the stage for a conflict that will have ramifications beyond India’s borders, and the commodity-driven sector where Ambani and Adani made their first fortunes, even in a country whose $3.2 trillion economy is entering the digital age. Emerging opportunities, from e-commerce to data streaming and storage, have spurred the rise of billionaire dynasties such as Carnegie, Vanderbilt and Rockefeller 19 It reminds me of the American boom of the century.
Arun Kejriwal, founder of Mumbai investment advisory firm KRIS, who has been tracking the Indian market and the two billionaires for 20 years, says that the two Indian families are equally hungry for growth, and that is inevitable. It states that it means that they collide with each other.
“Ambanis and Adanis work together, coexist and compete,” he said. “And finally, the fittest thrive.”
Adani and Ambani’s company representatives declined to comment on the story.
In an official statement on July 9, Adani Group said it had no intention of entering the consumer mobile space currently dominated by Ambani, and that the airwaves purchased at government auctions would create a “private network solution” and I said I would only use it for hardening. Cyber security at airports and ports.
Despite these comments, speculation abounds that he may eventually venture into offering wireless services to consumers.
Sankaran Manikutty, former professor and current Visiting Academic at the Indian Institute of Management, Ahmedabad, said: There, he worked extensively on family businesses, telecommunications and strategy in emerging economies.
For decades, Adani’s operations focused on sectors such as ports, coal mining and shipping, while Ambani had made significant investments in oil. But in this one year, that changed dramatically.
Adani Group was said in March to be exploring possible partnerships in Saudi Arabia, including a possible takeover of oil giant Aramco, according to Bloomberg News. A few months earlier, Reliance, which still derives most of its revenue from oil-related businesses, scrapped plans to sell his 20% stake in the energy sector to Aramco, leaving him in the pipeline for two years. canceled the transaction.
The two billionaires also have significant overlap in the green energy sector and have each pledged to invest more than $70 billion in areas closely tied to the priorities of Indian Prime Minister Narendra Modi’s government. Adani, meanwhile, is beginning to demonstrate deep ambitions in digital services, sports, retail, petrochemicals and media. Ambani’s Reliance either already dominates these sectors or has big plans.
In telecoms, history suggests prices could plummet in the early stages of competition if Adani starts targeting consumers in a big way. When he made his forays, he offered free calls and very cheap data. It’s a bold move that has lowered overall costs for consumers, but they’re rising again as he solidifies control.
On the surface, the two men look completely different. Ambani, 65, inherited his Reliance from his father, while Adani, 60, is a self-made businessman. But they also have some striking similarities.
Largely media-shy, both men have a history of being fiercely competitive, disrupting and dominating most sectors they set foot in. Analysts and executives who have worked with the pair say they are detail-oriented, passionate about pursuing business goals, and have a track record of delivering big projects.
Both hail from western Gujarat, home of Modi. Both companies have also closely tied their business strategies to the Prime Minister’s national priorities.
Not all of Adani’s deals overlap with Reliance, and despite Ambani remaining wary of spending large sums abroad amid an uncertain global outlook, he We are in a race to spend on M&A. Adani Group bought Israel’s Haifa port for his $1.2 billion in July. In May, he bought Holcim’s Indian cement unit for $10.5 billion.
For now, most of Adani’s new forays are still in its infancy, and it’s difficult to fully grasp the impact. But analysts agree that the two men are likely to play a major role in reshaping India’s business landscape, leaving much of the economy in the hands of two families. I’m here.
In countries where income inequality has only increased over the course of the pandemic, it could have remarkable consequences.
India’s current economic progress resembles America’s so-called 19th-century Gilded Age, but the South Asian country now faces the risk of rising inequality, said the director of the Center for Development and Alternatives in Ahmedabad. says Indira Harway.
“The rapid diversification and overlap between them can lead to a duopoly when they work together, hurting smaller companies in these sectors,” Hirway said. “If they start competing, it could affect the balance of the business environment, as both conglomerates will be fighting over resources and raw materials.”
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