Mukesh Ambani's Reliance Industries (RIL) on friday, announced its acquisition of Bharti's entire share of 74% in Bharti AXA. Sunil Mittal's Bharti Enterprises entered into joint ventures with the AXA Group in 2006 and held 74 per cent stake in both life and general insurance. After this act, the two ventures RIL and the French financial services major AXA group would now be partners.

About a year ago, Ambani brothers scrapped the non-compete agreement which was supposed to be enforced for five-years between their groups, which stopped them with competing against each other in sectors where either of the two-brother had presence. Soon after the deal was scrapped, Mukesh Ambani's RIL has started to enter in financial services sector which has been the dominion of younger brother Anil's group.

Anil's group is already a leading private player in financial services sector, including insurance, mutual funds, brokerage and non-banking financial services and was in competition with both Bharti AXA's life and general insurance. Besides, Sunil Bharti Mittal and Anil Ambani share a rivalry competition in the telecom business.

And, now with this move Ambani brothers will come head to head with each other in a fast growing insurance business. Mukesh will have to make some efforts for growing up insurance business as Anil's arm in insurance business is in the top 5 private players in the market. Last financial year, Anil Ambani's life insurance venture recorded a first year premium of Rs 3,000 crore as against Bharti Axa 's Rs 360 crore and in the general insurance venture, it generated gross premium of Rs 1,655 crore as against Bharti Axa 's Rs 550 crore.

With this foray in insurance business it has taken its first concrete step in the financial services market. RIL had entered in joint venture (JV) with DE Shaw in March and have plans to offer the entire spectrum of financial services including retail, investment banking and broking. And, it is also in talks to enter into mutual funds businesses as well.

OneIndia Money