uly 21 (Bloomberg) -- Indian officials said a legal battle between the billionaire Ambani brothers over the supply of natural gas involves “national property” and vowed to ensure the resource is used in accordance with government policy.
The fuel “doesn’t belong to them, but to the people of India,” Oil Minister Murli Deora said by telephone today from New Delhi, a day after the Supreme Court adjourned hearings in the lawsuit to Sept. 1. Oil Secretary R.S. Pandey, the top bureaucrat in the ministry, said yesterday “the government will protect its property at all costs.”
Anil Ambani wants to enforce a 2005 agreement requiring Reliance Industries Ltd., controlled by brother Mukesh Ambani, to sell gas from a Bay of Bengal field to his Reliance Natural Resources Ltd. at 44 percent less than the state-set price. Anil’s lawyers have questioned the government’s decision to ask a bench headed by Chief Justice K.G. Balakrishnan to scrap the pact based on an accord under which the family empire was split.
“The government will have legislation and rules in place, they will have the final say,” said Chong Yoon Chou, Singapore- based investment director at Aberdeen Asset Management Asia Ltd., which has $30 billion of assets. “The conflict highlights the risks of family run businesses.”
The Supreme Court allowed Mukesh Ambani’s company on July 20 to continue selling gas from the field to power and fertilizer producers, lawyers for the government and Reliance Industries said. India’s most valuable company hassurged 64 percent in Mumbai this year, outpacing the 56 percent gain in the benchmark Sensitive Index, as investors bet output from the country’s biggest gas field will boost earnings.
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