As Reliance Group Chairman Anil Ambani stares at $100 million pay-out, the once-billionaire has pleaded poverty claiming that his net-worth is zero.
A London court directed Anil Ambani to pay $100 million to the court in six weeks in response to a lawsuit filed by three state-controlled Chinese banks, which have claimed that they gave a loan of $925 million to Anil’s Reliance Communications in 2012 under the condition that he personally guarantee the debt.
However, Anil has claimed that the value of his investments has collapsed. “My net worth is zero after taking into account my liabilities. In summary, I do not hold any meaningful assets which can be liquidated for the purposes of these proceedings,” a Bloomberg report quotes him as telling the court.
Industrial & Commercial Bank of China Ltd (ICBC), China Development Bank and Export-Import Bank of China have reportedly sued Anil Ambani in London for defaulting on $708 million of loans including interests. It was following this that Anil Ambani was directed by the court to pay $100 million, which he reportedly plans to appeal against.
Anil said in the court filings that he has made enquiries of being able to bring in the required funds from external sources including his family but is unable to raise any finance for outside resources.
Judge David Waksman reportedly said that Anil clearly has more assets and income than he is letting on and that he didn’t believe that the Ambani family ‘have firmly and irrevocably brought the shutters down’.
“What I’m dealing with is an extraordinarily wealthy family who have helped each other in the past,” the Bloomberg report quotes the judge as saying.
Reliance Communications (RCom), the company for which Anil Ambani had taken the now defaulted loans is currently undergoing insolvency and is in the final stages of resolution.
Anil Ambani, the brother of Asia’s richest man, has seen his fortunes dwindling over the past years as several of businesses failed the clock profits and taste success.
The Ambani brothers split post the death of their father, who left behind his business empire to both the sons. These businesses were then split where Mukesh Ambani took over the oil and petrochemicals business, while Anil Ambani took over the telecom, media and electricity businesses.
While Mukesh’s Reliance Industries has now become the largest and the most valued business conglomerate in the country, Reliance Group has seen most of its businesses facing massive losses, with Reliance Communications undergoing insolvency.
However, despite the rivalry, Mukesh Ambani has bailed out Anil in the past. Last year, the Supreme Court of India threatened to jail Anil is he didn’t pay up Rs 5.5 billion to Ericsson India in a month’s time. Mukesh Ambani then stepped in and made the payment for Anil Ambani.
(With Agency Inputs)