Mumbai, May 23 (ANI): In a significant development, Reliance Industries Ltd. (RIL) and Reliance ADA Group companies on Sunday formally agreed to cancel all existing non-compete arrangements which the two groups entered in January 2006.
The two groups have entered into a new simpler, non-compete agreement with respect to only gas based power generation.
The new agreement has been approved by the board of directors of RIL and the respective Reliance ADA Group companies.
Mukesh Ambani-led Reliance Industries Ltd. is mostly into old economy businesses that include refining, gas and power while Anil Ambani's groups deal with new economy businesses like finance, entertainment and telecom.
The latest move means that RIL can now enter into the financial services and telecom business while Reliance ADAG can enter the refining business, an NDTV Profit report stated on Sunday.
The cancellation of the existing non-compete agreement offers enhanced operational and financial flexibility to both groups, and greater ability to participate in high growth sectors of the Indian economy, such as oil and gas, petrochemicals, telecommunications, power, and financial services.
However, RIL has agreed not to enter into Gas Based Power Generation Business for the period upto March 31, 2022. An appropriate exception has been made in respect of RIL's captive gas based power plants.
It is believed that these developments will eliminate any room for further disputes between the two groups, on matters relating to the scope and interpretation of the non-compete obligations. (ANI)