Time is not forever: A billionaire who was once richer than Mukesh Ambani, ended up being insolvent

Once one of wealthiest men on planet, Anil Ambani is currently in a terrible situation. This once-billionaire, engulfed by billions of dollars of debt, faced a terrible moment, as equity value of his entire company dropped to 4292 crore ($523 million) in 2019. After inheriting his wealth, Anil Ambani was named chairman of Reliance Anil Dhirubhai Ambani Group (Reliance AG) in 2008. Forbes listed Anil Ambani as sixth richest person in world in 2008, with a net worth of $42 billion, or 3447 thousand crore. Reliance A Group comprises several prominent companies, including Reliance Communications, Reliance Capital, Reliance Power, Reliance Infrastructure, Reliance Naval, and Reliance Home Finance.

Multi-billion dollar family business  

Mukesh and Anil Ambani's far, Dhirubhai Ambani, established multibillion dollar family business empire. Dhirubhai started out as a petrol station attendant in Yemen before rising from humble beginnings to become epitome of Rags to Riches tale. As present situation indicates, exact opposite seems to have happened with his younger son, Anil Ambani.

Anil Ambani: A Perfect Start 

In 1983, Anil Ambani took over as co-CEO of Reliance Industries, his far's business. Anil Ambani was an intelligent businessman who gruated from University of Pennsylvania's Wharton School in 1983 with a master's degree in business ministration. He is well-known for having played a key role in development of Indian financial industry, having introduced global depositary receipts, bonds, and convertible securities to international capital markets. Under Anil Ambani's leership, Reliance Industries raised $2 billion from global financial market. Anil Ambani was also selected to be a member of Rajya Sabha in 2004.

Split with big bror Mukesh Ambani 

In 2002, Dhirubhai Ambani passed away without leaving a will. After his far's passing, Anil was named managing director of Reliance Industries. At time, company was a Rs 28,000 crore business empire, and Mukesh was named chairman. In 2005, re was a hint of tension between brors. corporation was split in half as a result of brors' legal dispute over gas supply. Anil acquired telecom, power generation, and financial services industries, while Mukesh was given oil-refining and petrochemicals companies. y also entered into a "non-compete pact" that lasted until 2010.

Rise to pinnacle 

In 2007, Anil Ambani's total wealth exceeded Rs. 4 lakh crore, and he was recipient of multiple business honours. This fame and wealth were sparked by Reliance Communications. Not only that, but in 2008 he created history by obtaining a full subscription for Reliance Power IPO in under 60 seconds. It was largest initial public offering (IPO) Indian market h ever seen.

Time is not forever 

first of many challenges that faced Anil Ambani was dealing with fallout from 2008 financial crisis. record-breaking Rs.11,563 crore raised during Reliance Power IPO supported a number of upcoming projects. It was challenging to find natural gas at a fair price, which was required to start projects, because of 2008 financial crisis.

Major Causes of downfall

• Reliance Communications played a major role in his financial success, but company failed to compete in telecom market and was shut down in late 2017. This resulted from company's incapacity to transition to 4G networks, its debt-ridden state, and its dependence on hazardous business endeavours to maintain its financial stability. An even bigger threat came from his older bror Mukesh Ambani's Jio 4G network.
• In a disastrous move, Anil Ambani bought Pipavav Defence, which h debts totaling Rs. 7000 crore. Furrmore, Pipavav was brought before NCLT for an insolvency action by IDBI Bank and IFCI as a result of its incapacity to pay its debts.
• Anil Ambani's relationships with or banks and lenders suffered as a result of his loan defaults. When he was eventually brought before courts, he claimed he h run out of assets to sell and filed an appeal.

From his descent from wealth to poverty to fending off court summonses and making an effort to fulfil his debts, Anil Ambani appeared to have gone through it all. In 2023, his wealth was only Rs 250 crore, compared to Rs 4 lakh crore during 2008 financial crisis. ditionally, experts have asserted that this abrupt decline was caused by his poor business judgement and inability to compete in a competitive economic environment. Time will tell what lies ahe for Anil Ambani, as it seems that his situation is far from over.