Ambani Vs Ambani or Ambani & Ambani
Think about it. Their combined wealth of $38.3 bn will make them the second-richest biz family in the world.
By Vivek Sinha, TNN |
It is fashionable for Indian media to describe any bickering in the Ambani household as Ambani vs Ambani. For a moment, spare a thought for Ambani & Ambani. If the net worth of the two Ambani brothers is combined, it will propel them to the fourth slot globally in the Forbes list of billionaires and to the No.1 position among Indian billionaires, even ahead of Lakshmi Niwas Mittal.
Think about it. Their combined wealth of $38.3 billion will make them the second-richest business family in the world, next only to the Waltons of Wal-Mart whose combined wealth tots up to a staggering $83 billion. As Mukesh Ambani gears up to meet the threat of Wal-Mart in India, he might appreciate the irony.
Leave aside the irony, it would have made the legendary Dhirubhai Ambani proud. Strategy gurus around the world may see this as a great opportunity for a Harvard or a Kellogg case study - call it 'Divide And Grow.' It is possible that the emergence of the Ambanis as one of the biggest business families in the world would not have taken place if the two brothers had not split.
It's only a matter of time before Ambani & Ambani trounce Bill Gates, Warren Buffett and Mexican billionaire Carlos Slim. Consider: If RIL's joint venture with Dow were to go through and its retail venture takes off, it could easily add a few billion dollars to Mukesh's wealth. And Anil may take the Bulls by their horns with a few bulge-bracket acquisitions in telecom and financial services.
For the Ambani combine, the growth in wealth has been astounding so far - since 2002, when Dhirubhai's wealth was estimated at a paltry $2.9 billion, the combined Ambani wealth has galloped over 13 times to $38.3 billion this year. In the same period, Bill Gates is richer by a mere $4 billion - that's less than 10%. And Warren Buffett, the Sage of Omaha, is up a modest 50%, from $35 billion in 2002.
ADVERTISEMENTThere's another big reason why the Sultan of Software and the Sage may not be able to keep pace with the brothers. Gates and Buffett have committed a substantial part of their wealth to charity. Add to this the incidence of estate duty in the US, and Gates, Buffett and the Waltons are bound to drop places in the Richie Rich list in time to come. LN Mittal, being an Indian, may not be subject to estate duty and hence find it easier to stay in the reckoning for the top slot.
So give it another 4-5 years and Ambani & Ambani could well be the richest family in the world - at the very top of the Forbes list. It will truly be a tribute to what we at ET call the Global Indian Takeover - or, better still, the World At Your Feet.
Remember what Mukesh Ambani said, addressing RIL shareholders at last year's AGM, "This strategic move has resulted in incremental shareholder value of nearly Rs 46,000 crore ($10 billion), representing the market capitalisation of the demerged entities when listed. This is undoubtedly the largest shareholder value unlocked in Indian corporate history."
Ambani Sr later told ET in his first exclusive media interaction after the split, "The easiest way to look at it is that it's a win-win for both groups (RIL and R-ADAG)."
ET has always aspired to bring the two Ambani brothers together - as readers of ET would remember, we made them shake hands at the height of the Reliance split at the ET Awards For Corporate Excellence 2005-06. They could be running different businesses, but instead of working at cross-purposes, they should enhance the wealth of their shareholders - and, very soon, become the richest family on earth, even ahead of Bill Gates.
The recent Forbes list of billionaires places Mukesh Ambani and Anil Ambani at the 14th and 18th positions with individual net worth of $20.1 billion and $18.2 billion respectively. Their combined wealth of $38.3 billion will take them to the fourth slot, behind Bill Gates ($56 billion), Warren Buffett ($52 billion) and Carlos Slim ($49 billion). It will place them ahead of Ikea's Ingvar Kamprad ($33 billion) and steel king LN Mittal ($32 billion).
The growth of the two Ambani brothers after the split has been mind-numbing. Here's more fodder for Divide And Grow: In 2002, Forbes had ranked Dhirubhai Ambani at number 138 in the list of billionaires with a net worth of $2.9 billion. In 2003, when the two brothers were listed together for the first time, their net worth was $2.8 billion and were ranked at number 123.
Even when they were listed together for the last time by Forbes in 2005, they were ranked No.60 with a net worth of $7 billion. The demerger and the subsequent listing of companies has resulted in five-times increase in the combined net worth of the Ambani brothers as well as tremendous increase in market cap of both group companies
The world's second-richest business family, after the Waltons, hails from India - and their family members live under one roof, at the famed Ambani residence 'Sea Wind' in South Mumbai. Children of both brothers wait their turn to kiss their grandmother goodnight, the one person who's made sure that Ambanis stay with Ambanis. So far.
Forbes should take note: it's not easy to establish the wealth of Indian families, many factions of which still live under the same roof, share the same kitchen, pet the same dogs... And their children still play with each other in the backyard enjoying the Sea Wind and often, oblivious to business realities. For all you (and Forbes) know, LN Mittal's wealth may actually go up by a few more billions if you were to add the net worth of his brothers based in India.
From here, there's only one way for the two Ambani brothers to go - up. It's time they looked beyond competition, beyond rivalry, beyond business. Even beyond what's described as the highest point in Maslow's hierarchy of needs - self actualisation. More simply, towards a richer tomorrow, not defined merely in terms of the billions they make.
(We would like our readers to post their congratulatory messages to both Ambani brothers. Click here to do so)