Mukesh Ambani's succession plan focuses on GenNext, with Isha positioned to succeed infocomm Akash as chair of the telecom and retail holding companies.
Mukesh Ambani, the 65-year-old chairman of Reliance Industries Ltd NSE 1.05 %, has initiated succession planning at his sprawling retail-to-telecom-to-energy empire. On Monday, Ambani stepped down from the board of Reliance NSE 1.05 % Jio Infocomm Ltd (RJIL), the group’s telecom arm, to make way for his son Akash (30) to take over as chairman. RJIL is a wholly owned subsidiary of Jio Platforms, the holding company that owns all digital assets, including Reliance Jio Infocomm. Mukesh Ambani continues to remain the chairman of Jio Platforms. The retail business, though structured, on similar lines, is unlikely to see any major board level leadership reorganisation, including Isha Ambani’s elevation as chairperson, this fiscal year, according to people familiar with the Ambani family’s thinking. Both Akash and Isha are expected to get promoted to become respective chairpersons of the telecom and retail holding companies, at the same time, in the near future — the exact timelines of which are still being worked out. “Isha is very much in the driving seat in retail and continues to do so,” said a long-term Reliance watcher on the condition of anonymity. Reliance Retail Ventures Limited (RRVL), is the holding company of all retail businesses, which includes its partnerships with global and home-grown marquee fashion and lifestyle brands, 7-eleven convenience stores, online pharmacies, hypermarkets, supermarkets, electronics stores, food and grocery outlets etc. Under RRVL, comes its wholly owned subsidiary Reliance Retail Limited (RRL), the actual operating company for the business. Just like Jio Platforms, Mukesh Ambani is the chairman of RRVL. Siblings at par Since October 2014, Akash and Isha Ambani have been given formal business roles. Both joined the boards of Reliance Retail Ventures Ltd as directors and then in November 2019 were inducted into Jio Platforms. The youngest Anant (27) was appointed to the board of Jio Platforms in March 2020 and then Retail Retail Ventures Ltd in 2022. Before his recent elevation as chairman of Jio Infocomm, all three siblings had the same title of non-executive, non-independent directors on the board of RRVL and Jio Platforms. Isha and Anant will continue to remain on the boards of the telecom and retail holding companies. However, unlike the telecom business, no Ambani family member is on the board of RRL currently as per RoC data. Sources in the know say this has been designed on purpose to avoid “unnecessary distractions”. As per Companies Act, one cannot become chairperson of a company without first being the director of that company. “Shareholders decide their board of directors, but the directors decide who will chair that board. “So Isha is unlikely to become the chairperson of Reliance Retail Ltd NSE 0.14 %. Instead over the next few years, both Akash and Isha will get elevated as chairperson of the telecom and retail holding companies simultaneously as Mukesh Ambani would look to withdraw further from day-to-day operations.” Youngest brother Anant is focussing more on the legacy oil and gas and new energy business and is “currently learning on the job”. consultant, has been instrumental in Reliance’s ecommerce foray into fashion retail in 2016 by launching online shopping portal Ajio. Since then she has overseen multiple acquisitions as well as a diversification into the beauty segment. RRVL, like Jio Platforms, also on-boarded marquee investors TPG, KKR, ADIA, General Atlantic in 2020 at a $62 billion valuation. The unit operates more than 12,000 stores across the country. She is also a director at the Reliance Foundation Institution of Education and Research (RFIER), which is setting up the Jio Institute, an upcoming university. “Ambani is carefully putting a transition plan in place at multiple levels including inviting strategic partners in the businesses not only financially but also with technological know-how and capability. The siblings have been involved in the businesses for nearly a decade now and both have been leading global partnerships for telecom as well as retail business,” said another official aware of the development. Equal ownership The Ambani family is unlikely to create a family trust or a council and instead opt for an LLP route which is a far more efficient way of tax planning, wealth preservation and succession planning. The Tata Trust-Tata Sons model is years old,” said an analyst, close to the company. Over the last few years, the five-member Ambani family has untangled cross holdings and currently own equal stakes in flagship RIL in their personal capacity. In 2020, through a series of transactions, Mukesh Ambani, his wife Nita, and the three children had rearranged their shareholdings in RIL by acquiring shares from each other. In March, promoters along with two group firms — Tattvam Enterprises LLP and Samarjit Enterprises LLP — acquired 3.2% shares of RIL from Devarshi Commercials LLP, another group entity. As on March 2022, promoters own 50.66% of the company, of which Mukesh Ambani, his wife Nita, children Isha, Akash and Anant each own 0.12% in their personal capacity. Matriarch Kokilaben Dhirubhai Ambani, Mukesh’s mother, owns 0.24%. “The transaction is part of a restructuring of promoter group holding by inter-se transfer among the persons belonging to promoter and promoter group,” RIL had told exchanges in a filing then.