Two months after the rift between the two siblings who control the $22.6 billion Reliance group became public in mid-November, the estranged brothers have not reached a settlement, fuelling speculation about an ownership split of one of India's biggest business empires.
The board of Reliance Industries, the $17 billion group flagship with dominant interests in petrochemicals, and oil and gas refining and marketing, endorsed the leadership of Mukesh Ambani, the older brother and Reliance chairman and managing director, at a meeting on December 27.
The board also approved the buyback of the company's stock worth Rs29 billion ($690 million) at a price not exceeding Rs570 per share, representing 10% of the paid-up capital and free reserves of the company.
The younger sibling, Anil Ambani, who is vice-chairman and also a managing director of RIL, abstained from the vote, aimed at shoring up confidence among minority shareholders.
A company release points out that the maximum buyback price is at a premium of 11% over the average one-year trading price range and is expected to improve the earnings per share and return on net worth of the company.
Unlike in a fixed-price tender offer where the company must buy all shares tendered, under the Reliance buyback the company has the option but not an obligation to buy shares in the secondary market.