RNRL signs new gas pact with RIL; Stocks move upBy IANS
Friday, June 25, 2010
MUMBAI - Anil Ambani-promoted Reliance Natural Resources (RNRL) Friday signed a revised gas supply agreement with Reliance Industries (RIL), controlled by Mukesh Ambani, which sent stocks of both the groups soaring.
The agreement follows the Supreme Court ruling asking both sides to renegotiate and finalise a new gas sales deal as per the rules set by the government and subsequent assurance given by the elder Ambani to supply gas to the younger brother’s company.
“Pursuant to the judgment of the Supreme Court dated May 7, 2010, RIL and RNRL have on June 25, 2010 signed a revised gas supply master agreement (GSMA),” RNRL said in a statement to the Bombay Stock Exchange.
The company said it will now ask the government to expedite allocation of natural gas.
The RNRL statement, however, did not mention the price, tenure of supply and the quantity of gas, agreed with Reliance Industries.
Reliance Industries, too came out with an almost identical statement.
At the annual general meeting of Reliance Industries June 18, Mukesh Ambani had assured gas supply to the Anil Ambani-controlled power plants.
“As and when the power plants of ADAG are ready, we will commence supplies subject to government granting allocations to these plants,” he had said.
At the Bombay Stock Exchange, both scrips rose immediately after the announcement. While RNRL moved to an intra-day high of Rs.68.65, up 7.5 percent from its previous close, but closed lower at Rs.65.95. RIL’s stock also closed on a high, at Rs.1,063.25, up 1.14 percent from its previous close.
The deal came weeks after the two brothers terminated an earlier non-compete agreement, allowing the two groups to enter into any business or industry, other than gas-based power generation by Mukesh Ambani-led Reliance Industries for 12 years.
Other group company stocks from the ADAG pack also benefited from the news.
Reliance Communications closed 2.34 percent higher at Rs 192.50, while Reliance Infrastructure ended 0.47 percent up at Rs.1,168.05.
Reliance Capital too shut shop 1.16 percent higher at Rs 768.75.