RIL board plans to shelve buyback offer

Mukesh Ambani-controlled Reliance Industries is all set to shelve midway its ongoing share buyback programme -- which was opposed from the very beginning by younger Ambani scion Anil -- in the wake of the two reaching a settlement.

Nearly eight months after it approved the buyback at Rs 570 a share, for which a provision of Rs 2,990 crore (Rs 29.90 billion) was made, RIL's board would meet on July 27 to consider closing of the offer, the company on Friday informed the Bombay Stock Exchange.

"The company's board, which is scheduled to meet on July 27, will consider the proposal for closing the buyback offer of equity share," the communique said.

The Reliance saga

The move to shelve the offer, for which the investment bankers like JM Morgan Stanley and DSP Merill Lynch were roped in and evoked little response, comes well before its expiry of one year on January 10, 2006.

At the board meeting on December 27, which approved the buyback offer, the then vice chairman and managing director Anil Ambani opposed the move and said instead of buyback, the shareholders should be given bonus shares.

However, Anil was isolated with all the other directors siding with Mukesh to unanimously approve the buyback.