The long-simmering feud flared anew last week when older brother Mukesh, who heads Reliance Industries Limited (RIL), India's biggest private firm, told South African telecoms giant MTN he had first right of refusal in any sale of a controlling stake in Anil's Reliance Communications.

Reliance Communications entered exclusive talks in late May to combine with MTN to build a telecoms giant that would reach from Asia to Africa to the Middle East with a market capitalisation of up to US$70 billion (S$96.5 billion).

MTN, Africa's largest mobile operator, says it is still going ahead with the talks. 'Nothing has changed. We are still having talks,' MTN spokesman Nozipho January-Bardill said.

'Talks are on track - in fact, they are progressing well,' said a Reliance Communications official.

But legal experts say the row - which hinges on a settlement deal involving the carve-up of the Reliance empire after the 2002 death of the brothers' father, Dhirubhai Ambani - could throw a spanner in the works.

On Saturday, Anil threatened legal action against Mukesh if he tries to block the deal, a Reliance Communications source said.

If RIL 'chooses to take any legal action, the same will be vigorously defended by Reliance Communications, and Reliance Communications will claim costs and damages from RIL', the source said.

RIL insists a 2006 pact stipulates that a decision on a majority stake sale in any of the firms belonging to the original group can be taken only after consultations with parties involved in the settlement.

AGENCE FRANCE-PRESSE

Feud began after father's death

The discord between the stockily built Mukesh and the athletic Anil, who is a vegetarian teetotaller, came to a head in 2004.

The battle was ignited when Mukesh, known as a stickler for detail with a head for executing large projects, had the board pass a motion telling all directors, including Anil, to report to him, saying it had been his father's wish.

Anil, who had always been the more outgoing brother, appearing frequently on society pages, fought back in what turned into a mud-slinging corporate soap opera.

The only thing the brothers agreed on was their reverence for Ambani family matriarch Kokilaben, and they asked her to broker a deal which brought a temporary fraternal ceasefire and the carve-up of the Reliance conglomerate.

Mukesh kept the oil, gas and petrochemicals businesses of the group flagship Reliance Industries. Anil got Reliance Energy, one of India's biggest power utility firms, the�phone company which is his group's flagship, and finance arm Reliance Capital.

But the deal did not bring harmony and even though the brothers still live in the 18-storey family mansion in the ritzy south Mumbai area, they rarely speak.

The last time the two US-educated brothers seemed truly united was in 2002, at their father's funeral pyre, where they stood grieving side by side, observers say.

AGENCE FRANCE-PRESSE