New Yug begins at Jio Infocomm as Mukesh Ambani hands over telecom arm to son Akash in well-crafted succession move

The Jio Infocomm baton has been passed, and the succession plan at India’s most valuable company is now beginning to slot into shape. Chairman and Managing Director of Reliance Industries Ltd Mukesh Ambani has handed over the reins of Reliance Jio Infocomm to his elder son, 26-year-old Akash. The Reliance Jio Infocomm board at a meeting on Monday “approved the appointment of Akash M Ambani, non-executive director, as chairman of the board of directors of the company”, the company said in a stock exchange filing on Tuesday.

This comes after his father resigned with effect from the close of working hours on June 27, it said. Jio Infocomm is a unit of Reliance Industries Ltd, whose businesses include oil refining, petrochemicals, retail, media, and new energy. Mukesh Ambani will continue to be the chairman of Jio Platforms Ltd – the flagship company that owns all Jio digital services brands, including Reliance Jio Infocomm.

The 65-year-old RIL chief has three children: twins Akash and Isha, and the youngest son Anant. Akash and Isha have been on the boards of Reliance Retail Ventures Ltd – the company that operates supermarkets offering consumer electronics, food and grocery, fashion, jewellery, footwear, and clothing as well as online retail venture JioMart – and digital arm Jio Platforms Ltd (JPL) since October 2014. Akash, who majored in economics at Brown University, has been closely involved with the disruptive and inclusive growth path charted by the digital services and consumer retail propositions of Reliance group and is now leading the creation of the ‘convergence dividend’ for over 500 million consumers, digitally and with high-inclusivity across geographies and income levels.

The young Ivy League alumnus has been closely involved with the creation of the digital ecosystem around Jio’s 4G proposition. He worked with a team of engineers in inventing and launching an India-specs focussed Jiophone in 2017 that revolutionised the 2G-to-4G shift across India. Akash has also personally overseen key acquisitions made by Jio Platforms in the digital space in the last few years, besides playing a leading role in the development of new technologies and capabilities, including AI-ML and blockchain.

Trailblazing global investments by tech majors and investors in 2020 that put Jio on the global map was an initiative shepherded by Akash. He is now expected to continue to lead with cutting-edge innovation and technology to encourage an ecosystem that will further digital solutions and make the power of data and technology more accessible to all, including those still at the margins. Among other appointments, Pankaj Mohan Pawar was appointed Managing Director of Reliance Jio Infocomm for five years beginning June 27, the filing said.

Former Union finance secretary Raminder Singh Gujral and former CVC KV Chowdary were appointed independent directors, it added. The two are already on the RIL board. Reliance has three broad businesses – oil refining and petrochemicals, retail and digital services that include telecom.

While retail and digital services are housed in separate wholly-owned subsidiaries, the oil-to-chemical or O2C business is a functional division of Reliance. The new energy business is also with the parent firm. The three businesses are almost equal in size.

While Akash and Isha have been both active in the group’s new-age businesses of retail and telecom, Anant has been looking at the renewable energy and oil and chemical units of Reliance as a director. The announcement outlines a clear transfer of wealth by the RIL chief, whose net worth is over $109 billion. His wife Nita, 59, too is on board of Reliance.

As per the company filings, the Ambani family’s current stake in Reliance has risen to 50. 6 per cent from 47. 27 per cent in March 2019.

Ambani first spoke of a succession plan at Reliance Family Day, which marks the birth anniversary of the group’s founder Dhirubhai Ambani, on December 28 last year. Reliance, he had said, is “now in the process of effecting a momentous leadership transition. “Prior to that, at the company’s annual general meeting (AGM) in June 2021, he had indicated that his children will now find a prominent place in the family’s vast empire.

He had said: “I have no doubt whatsoever that the next generation of leaders at Reliance, led by Isha, Akash and Anant, will further enrich this precious legacy. “The succession plan comes at a time when Reliance is in the middle of a very expensive switch to clean fuels by investing across the entire value chain of solar, batteries and hydrogen. Just as steady cash flows from oil refining and petrochemicals made it possible for Reliance to incubate telecom from scratch, profits from digital businesses and retail may allow it to replace hydrocarbons — the conglomerate’s traditional source of wealth — with green energy over the next decade.

Dhirajlal Hirachand Ambani, also known as Dhirubhai Ambani, had founded Reliance in 1973. He led the family business expansion from textile to oil to telecom but the family plunged into chaos after his sudden death in 2002. The differences between Mukesh and his younger brother Anil grew and after three years of bitter war, mother Kokilaben in 2005 divided Reliance’s assets.

Mukesh got refining, petrochemicals, oil and gas and textile businesses, while Anil was made in charge of telecommunications, asset management, entertainment and power generation businesses. Over years, Mukesh Ambani transformed Reliance into a behemoth with re-entry into the telecom business as well as forays into retailing and clean energy, while Anil Ambani’s business empire crumbled. Since 2019, Mukesh Ambani has been slowly overhauling the top-heavy hierarchy at Reliance to improve governance in line with global standards.

He sold a 32. 97 per cent stake in Jio Platforms to likes of Google, Facebook and other venture capitals and got a clutch of foreign investors in the retail venture. In Reliance’s new structure, different business verticals will be run like independent businesses.

There will be no interdependencies between group companies for raising capital or debt servicing. The Ambani family is also consolidating its ownership in the company. ​With inputs from agenciesDisclaimer: Firstpost is a part of the Network18 group.

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