 | This article may contain wording that promotes the subject in a subjective manner without imparting real information. (May 2009) |
| Dhirajlal Hirachand Ambani | |
|---|---|
 Dhirubhai Ambani in 1992 | |
| Born | 28 December 1932 Chorwad, Gujarat, India |
| Died | 6 July 2002 (aged 69) Mumbai, Maharashtra, India |
| Cause of death | stroke |
| Nationality | Indian |
| Ethnicity | Gujarati |
| Occupation | Founder of Reliance Industries Founder of Reliance Power Founder of Reliance Capital |
| Net worth |  $8 billion[citation needed] |
| Religion | Hindu |
| Spouse | Kokilaben Ambani |
| Children | Mukesh Ambani Anil Ambani Nina Kothari Deepti Salgaonkar |
Dhirajlal Hirachand Ambani (Gujarati: ધીરજલાલ હીરાચંદ અંબાણી ; 28 December 1932 – 6 July 2002) was an Indian rags-to-riches business tycoon who founded Reliance Industries in Mumbai with his cousin. Ambani took his company public in 1977. Dhirubhai has been among the select few to be figured in the Sunday Times list of top 50 businessmen in Asia.[1] His life has often been referred to as a true "rags to riches" story.[citation needed]
Dhirubhai started off as an owner with Arab merchants in the 1950s and moved to Mumbai in 1958 to start his own business in spices. After making modest profits, he moved into textiles and opened his mill near Ahmedabad. He founded Reliance Industries in 1966, and today, the company, with over 85,000 employees, provides almost 5% of the Central Government's total tax revenue.
Following a heart attack in 1985, Dhirubhai handed over the Reliance empire to his sons Mukesh and Anil. After his death, the group was split intoReliance Industries Limited, headed by Mukesh Ambani, and Reliance Anil Dhirubhai Ambani Group (Reliance ADAG), headed by Anil Ambani.
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[edit]Majin Commercial Corporation
Dhirubhai Ambani returned from Yemen to India and started "Majin" in partnership with Champaklal Damani,[citation needed] his second cousin, who used to be with him in Aden, Yemen. Majin was to import polyester yarn and export spices to Yemen.[2] The first office of the Reliance Commercial Corporation was set up at the Narsinatha Street in Masjid Bunder. It was a 350 sq ft (33 m2) room with a telephone, one table and three chairs. Initially, they had two assistants to help them with their business. During this period, Dhirubhai and his family used to stay in a one-bedroom apartment at the Jai Hind Estate in Bhuleshwar, Mumbai. In 1965, Champaklal Damani and Dhirubhai Ambani ended their partnership and Dhirubhai started on his own. It is believed that both had different temperaments and a different take on how to conduct business. While Damani was a cautious trader and did not believe in building yarn inventories, Dhirubhai was a known risk-taker and believed in building inventories, anticipating a price rise, and making profits.[3]
[edit]Reliance Textiles
Sensing a good opportunity in the textile business, Dhirubhai Ambani, along with Amit Mehra, a Delhi-based chartered accountant and company secretary residing in Ashok Vihar, Delhi, started the first textile mill at Naroda, in Ahmedabad in the year 1966. Textiles were manufactured using polyester fiber yarn.[4] Dhirubai started the brand "Vimal", which was named after his elder brother Ramaniklal Ambani's son, Vimal Ambani. Extensive marketing of the brand "Vimal" in the interiors of India madhe Reliance Textiles' Manufacturing unit, certifying it as "excellent even by developed country standards" during that period. Amit Mehra had played a pivotal role in helping and supporting Dhirubhai in this success.[5]
[edit]Dhirubhai's control over stock exchange
In 1982, Reliance Industries came up against a rights issue regarding partly convertible debentures.[6] It was rumored that the company was making all efforts to ensure that their stock prices did not slide an inch. Sensing an opportunity, The Bear Cartel, a group of stock brokers from Calcutta, started to short sell the shares of Reliance. To counter this, a group of stock brokers until recently referred to as "Friends of Reliance" started to buy the short sold shares of Reliance Industries on the Bombay Stock Exchange.[citation needed]
The Bear Cartel was acting on the belief that the Bulls would be short of cash to complete the transactions and would be ready for settlement under the "Badla" trading system operative in theBombay Stock Exchange. The bulls kept on buying and a price of 
152 per share was maintained until the day of settlement. On the day of settlement, the Bear Cartel was taken aback when the Bulls demanded a physical delivery of shares. To complete the transaction, the much needed cash was provided to the stock brokers who had bought shares of Reliance, by none other than Dhirubhai Ambani. In the case of non-settlement, the Bulls demanded an Unbadla, or penalty sum, of 35 per share. With this, the demand increased and the shares of Reliance shot above 180 in minutes. The settlement caused an enormous uproar in the market.
152 per share was maintained until the day of settlement. On the day of settlement, the Bear Cartel was taken aback when the Bulls demanded a physical delivery of shares. To complete the transaction, the much needed cash was provided to the stock brokers who had bought shares of Reliance, by none other than Dhirubhai Ambani. In the case of non-settlement, the Bulls demanded an Unbadla, or penalty sum, of 35 per share. With this, the demand increased and the shares of Reliance shot above 180 in minutes. The settlement caused an enormous uproar in the market.
To find a solution to this situation, the Bombay Stock Exchange was closed for three business days. Authorities from the Bombay Stock Exchange (BSE) intervened in the matter and brought down the "Unbadla" rate to 2 with a stipulation that the Bear Cartel had to deliver the shares within the next few days. The Bear Cartel bought shares of Reliance from the market at higher price levels and it was also learnt that Dhirubhai Ambani himself supplied those shares to the Bear Cartel and earned a healthy profit out of The Bear Cartel's adventure.[7]
2 with a stipulation that the Bear Cartel had to deliver the shares within the next few days. The Bear Cartel bought shares of Reliance from the market at higher price levels and it was also learnt that Dhirubhai Ambani himself supplied those shares to the Bear Cartel and earned a healthy profit out of The Bear Cartel's adventure.[7]
After this incident, many questions were raised by his detractors and the press. Not many people were able to understand as to how a yarn trader until a few years ago was able to get in such a huge amount of cash flow during a crisis period. The answer to this was provided by the then finance minister, Pranab Mukherjee in the Parliament. He informed the house that a Non-Resident Indian had invested up to 220 million in Reliance during 1982-83. These investments were routed through many companies like Crocodile, Lota and Fiasco. These companies were primarily registered in Isle of Man. The interesting factor was that all the promoters or owners of these companies had a common surname Shah. An investigation by the Reserve Bank of India in the incident did not find any unethical or illegal acts or transactions committed by Reliance or its promoters.[8]
220 million in Reliance during 1982-83. These investments were routed through many companies like Crocodile, Lota and Fiasco. These companies were primarily registered in Isle of Man. The interesting factor was that all the promoters or owners of these companies had a common surname Shah. An investigation by the Reserve Bank of India in the incident did not find any unethical or illegal acts or transactions committed by Reliance or its promoters.[8][edit]Death
Dhirubhai Ambani was admitted to the Breach Candy Hospital in Mumbai on June 24, 2002 after he suffered a major stroke. This was his second stroke. The first one had occurred in February 1986 and had kept his right hand paralyzed. He was, latterly, in a state of coma for more than a week. A number of doctors were used. He died on July 6, 2002.
The country has lost iconic proof of what an ordinary Indian fired by the spirit of enterprise and driven by determination can achieve in his own lifetime.[9]
The nation has lost one of the doyens of the modern Indian corporate community, a philanthropist and above all a great human being endowed with great compassion and concern for the underprivileged sections of the society. This new star, which rose on the horizon of the Indian industry three decades ago, remained on the top until the end by virtue of his ability to dream big and translate it into reality through the strength of his tenacity and perseverance. I join the people of Maharashtra in paying my tribute to the memory of Ambani and convey my heartfelt condolences to the bereaved family.[10]— P C Alexander, Governor of Maharastra
[edit]Reliance after Dhirubhai
In November 2004, Mukesh Ambani in an interview, admitted to having differences with his brother Anil over 'ownership issues.' He also said that the differences "are in the private domain." He was of the opinion that this will not have any bearing on the functioning of the company saying Reliance is one of the strongest professionally-managed companies. Considering the importance of Reliance Industries to the Indian economy, this issue got extensive coverage in the media.[11]
Kundapur Vaman Kamath, the Managing Director of ICICI Bank[12] was seen in media, a close friend of the Ambani family who helped to settle the issue. The brothers had entrusted their mother, Kokilaben Ambani, to resolve the issue. On June 18, 2005, Kokilaben Ambani announced the settlement through a press release.
With the blessings of Srinathji, I have today amicably resolved the issues between my two sons, Mukesh and Anil, keeping in mind the proud legacy of my husband, Dhirubhai Ambani.
I am confident that both Mukesh and Anil, will resolutely uphold the values of their father and work towards protecting and enhancing value for over three million shareholders of the Reliance Group, which has been the foundational principle on which my husband built India's largest private sector enterprise.
Mukesh will have the responsibility for Reliance Industries and IPCL while Anil will have responsibility for Reliance Infocomm, Reliance Energy and Reliance Capital.
My husband's foresight and vision and the values he stood for combined with my blessings will guide them to scale new heights.[13]— Kokilaben Ambani
[edit]Popular in Media
In 1998, a book published by Hamish McDonald titled "The Polyester Prince" is also an unauthorized biography of Dhirubhai Ambani, outlining all his political and business conquests. HarperCollins didn't sell the book in India, because the Dhirubhai threatened legal action.[14] In 2010, an updated version of the book went on sale in India, called Ambani and Sons, there has been no legal action against the publisher so far.[14]
A film said to be inspired by the life of Dhirubhai Ambani was released on 12 January 2007. The Hindi Film Guru, directed by ace filmmaker Mani Ratnam, cinematography by Rajiv Menon and music by A.R.Rahman shows the struggle of a man striving to make his mark in the Indian business world with a fictional Shakti Group of Industries. The film stars Abhishek Bachchan, Mithun Chakraborty, Aishwarya Rai, R. Madhavan and Vidya Balan. In the film, Abhishek Bachchan plays Guru Kant Desai, a character implicitly based on Dhirubhai Ambani. The character is known in the film as "Gurubhai", similar to the real-life "Dhirubhai". Mithun Chakraborty portrays Manikda who bears an uncanny resemblance to the real life Ramanath Goenka and Madhvan portrays S. Gurumurthy, who gained national fame twenty years ago, spearheading virulent attacks against the Reliance group in one of India's bloodiest corporate wars ever.
[edit]Awards and recognitions
- October 2011-Awarded posthumously the ABLF Global Asian Award at the Asian Business Leadership Forum Awards.
- November 2000–Conferred Man Of The Century award by Chemtech Foundation and Chemical Engineering World in recognition of his outstanding contribution to the growth and development of the chemical industry in India.
- 2000, 1998 and 1996– Featured among Power 50-the most powerful people in Asia by Asiaweek magazine.
- June 1998 - "Dean's Medal" by The Wharton School, University of Pennsylvania, for setting an outstanding example of leadership. Dhirubhai Ambani has the rare distinction of being the first Indian to get Wharton School Dean's Medal [15]
- August 2001 – Economic Times Awards for Corporate Excellence for Lifetime Achievement.
- Dhirubhai Ambani was named the "Man of 20th Century" by the Federation of Indian Chambers of Commerce and Industry (FICCI).
- A poll conducted by The Times of India in 2000 voted him "Greatest Creator of Wealth In The Centuries"
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