The embattled Indian tycoon says while he agreed to give a non-binding “personal comfort letter," he never gave a guarantee tied to his personal assets - an “extraordinary potential personal liability”. He’s the brother of Mukesh Ambani, who’s worth $56 billion and is the wealthiest man in Asia and 14th richest in the world. Anil, on the other hand, has seen his personal fortune dwindle over recent years, losing his billionaire status.
ICBC “failed and continues to fail, to distinguish between Anil on the one hand, and the company to whom the loans were being extended...on the other,” his lawyer Robert Howe said in a court filing.
Anil was chairman of RCom, which fell into administration earlier this year. His wider telecommunications-to-infrastructure empire Reliance Group has continued to struggle under a mountain of debt. As of July, four of its biggest units, excluding the phone company, had about Rs 93,900 crore ($13.2 billion) of debt, Bloomberg reported in September.
Anil was caught up in a similar case earlier this year, when India’s Supreme Court threatened him with prison after RCom failed to pay to pay 550 crore to Ericsson AB’s Indian unit. The judges gave him a month to find the funds, and his brother, Mukesh, stepped in to make the payment.
According to a court filing, Anil went to Beijing in the winter of 2011 to negotiate the loan with ICBC’s former Chairman Jiang Jianqing directly. The lenders sought a share pledge before granting the loans, but the legal dispute centers on whether Anil or one of his associates went on to provide a personal guarantee as security.
Hasit Shukla, Reliance’s commercial and treasury head, signed a personal guarantee on Anil’s behalf by power of attorney when the loan was set up seven years ago, Thanki said. But Anil didn’t give Shukla the authority to sign for him, making the guarantee non-binding, his lawyer Robert Howe said in written submissions.
“Anil’s position is that the claim made by ICBC in relation to his alleged personal guarantee for loans to RCOM is without merit,” a spokesman for the tycoon said in an email.
Industrial & Commercial Bank is the sole claimant in the London case, and is representing itself and the other two lenders. “This is a straightforward debt claim to recover outstanding loans made to RCOM in good faith, and secured by a personal guarantee given by Mr. Anil Ambani,” the banks said in a statement.
In Thursday's court hearing, ICBC's lawyers asked Judge David Waksman for an early ruling or a conditional order requiring Ambani to pay into court the unpaid sum and interest under the facility agreement. Ambani has declined to give any evidence of his wealth, they said.