24 March 2005 10:57 [Source: ICIS news]
SINGAPORE (CNI)--India's Reliance Industries share prices rose sharply on unconfirmed reports that the Ambani brothers Anil and Mukesh were close to settling their dispute over ownership issues.
Early on Thursday, the stock price climbed to Rs560.10 ($12.80/Euro9.86) from Rs553.15 at Wednesday's floor close. The intraday high was pegged at Rs567.90, with the low at Rs555.50. A month ago, the share price was at Rs546.65.
Although the stock price has increased significantly over the last two days, it was still far away from breaking the 52-week high of Rs600.90 set on 11 March, 2005.
A Reuters report quoting sources close to the negotiations said that the Ambani brothers were close to a settlement, which might end the long standing dispute over ownership and control of the country's largest private conglomerate.
The dispute became public in November after months of media speculation about differences between the brothers following the death of their father, group founder Dhirubhai Ambani, in 2002.
The report said that the one thing both brothers had agreed to was that they would not split up Reliance Industries. Speculation that a resolution could be near boosted shares of several Reliance group companies in an otherwise weak Bombay stock market on Wednesday.
The younger brother Anil was likely to get management control of the telecoms arm, Reliance Infocomm, as part of the deal.
Mukesh is chairman of Reliance Industries, which holds a 45% stake in Reliance Infocomm. Anil is vice-chairman of Reliance Industries and also heads Reliance Energy Ltd.
The bullish news made its initial impact on the stock market on Wednesday. Reliance Energy shares ended 0.8% higher at Rs537.35, after rallying as much as 5%. Shares in Indian Petrochemicals Corp Ltd., India's second-biggest petrochemicals maker, ended 0.3% higher at Rs167.45.
A Reliance spokesman declined to comment on the reports on Thursday.
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