Reliance Communications [Get Quote] and Infrastructure Ltd, the holding company of Reliance Infocomm, has in effect transferred its holding in Reliance Infocomm to a third company, Reliance Mobile.

Reliance Mobile was then renamed Reliance Information and Communications Ltd, a name that is similar to that of the original holding company.

The Reliance 'ownership issue'

This is the outcome of the demerger of RCIL's investment division and its transfer in April 2004 to Reliance Mobile, which used to be a subsidiary of Reliance Telecom (in which Reliance Industries [Get Quote] holds roughly a 36 per cent stake).

It is not clear whether the board of Reliance Industries was informed about the transfer of the investment division, so that Reliance Industries in turn could inform the stock exchanges, and why the division was transferred in the first place.

It could be argued that RCIL is not a listed company and so the stock exchanges do not need to be informed of the transfer. But RCIL's shareholders include Reliance Industries (which has a 45 per cent stake), its chief Mukesh Ambani and others (45 per cent stake), with 10% reserved for sweat equity.

Asked for answers to these questions, a Reliance executive said that he would be in a position to reply only on Wednesday.

The investment division makes strategic investments in companies in the telecom, information technology and other industries and has net assets worth Rs 4, 680 crore (Rs 46.8 billion). It has investments worth Rs 2,720.83 crore (Rs 27.21 billion) in Infocomm shares, apart from an investment of Rs 500,000 in Reliance Communications Technologies Ltd.