Billionaire inheritance battle places highlight on India's messy household succession

[ad_1] Devina Gupta BBC Information, Delhi

<img sizes="(min-width: 1280px) 50vw, (min-width: 1008px) 66vw, 96vw" srcset="https://ichef.bbci.co.uk/news/240/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 240w,https://ichef.bbci.co.uk/news/320/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 320w,https://ichef.bbci.co.uk/news/480/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 480w,https://ichef.bbci.co.uk/news/640/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 640w,https://ichef.bbci.co.uk/news/800/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 800w,https://ichef.bbci.co.uk/news/1024/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 1024w,https://ichef.bbci.co.uk/news/1536/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp 1536w" src="https://ichef.bbci.co.uk/news/480/cpsprodpb/159d/live/c67161e0-7415-11f0-9957-5d2f404dbce0.jpg.webp" loading="eager" alt="Sunjay Kapur/X Sunjay Kapur wearing a black suit with a blue printed tie and a white shirt holding the mic. " class="sc-d1200759-0 dvfjxj"/> Sunjay Kapur/X Sunjay Kapur suffered a coronary heart assault in June whereas enjoying polo within the UK

An Indian tycoon's sudden dying in June has triggered a fierce inheritance battle at an Indian automotive large.

Sunjay Kapur, 53, suffered a coronary heart assault on 12 June whereas enjoying polo in Surrey within the UK. He was an inheritor to Sona Comstar, a $3.6bn (£2.7bn) enterprise empire he inherited from his father. The corporate, amongst India's prime auto element makers, has a worldwide footprint with 10 crops unfold throughout India, China, Mexico and the US.

A polo fanatic, Kapur moved within the elite social circles of Indian capital Delhi, and reportedly shared a friendship with Prince William. He was married thrice - first to designer Nandita Mahtani, then to 90s Bollywood star Karisma Kapoor, earlier than marrying Priya Sachdev, a former mannequin and entrepreneur, in 2017.

However weeks after his dying, the query of succession has made Kapur and his household the topic of media hypothesis.

On the centre of it's Kapur's mom Rani Kapur, former chairperson of Sona Comstar.

On 24 July, Rani Kapur despatched a letter to the board of Sona Comstar, elevating questions on her son's dying and appointments made by the corporate after that.

Within the letter, which the BBC has seen, she alleged that Kapur's dying was underneath "extremely suspicious and unexplained circumstances".

The coroner's workplace in Surrey instructed the BBC that after a postmortem, it had decided that Kapur died of pure causes. "The investigation has been closed," the workplace mentioned.

<img sizes="(min-width: 1280px) 50vw, (min-width: 1008px) 66vw, 96vw" srcset="https://ichef.bbci.co.uk/news/240/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 240w,https://ichef.bbci.co.uk/news/320/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 320w,https://ichef.bbci.co.uk/news/480/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 480w,https://ichef.bbci.co.uk/news/640/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 640w,https://ichef.bbci.co.uk/news/800/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 800w,https://ichef.bbci.co.uk/news/1024/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 1024w,https://ichef.bbci.co.uk/news/1536/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp 1536w" src="https://ichef.bbci.co.uk/news/480/cpsprodpb/f3c5/live/741079d0-6df4-11f0-91e4-17f65efb9246.jpg.webp" loading="lazy" alt="Getty Images Sanjay Kapur (R) and Karishma Kapur attend the inauguration of the new Cartier Boutique at Dubai Mall on March 26, 2009 in Dubai, United Arab Emirates. Today Cartier officially inaugurated its largest boutique in the Middle East in the prominent and lavish Dubai Mall" class="sc-d1200759-0 dvfjxj"/> Getty Photos Sunjay Kapur was married to Bollywood actress Karisma Kapoor, however the couple later divorced

Rani Kapur additionally claims to have been coerced into signing key paperwork whereas underneath psychological and emotional misery from her son's dying.

"It's unlucky that whereas the household and I are nonetheless in mourning, some individuals have chosen this as an opportune time to wrest management and usurp the household legacy," she wrote.

She additionally requested Sona Comstar's board to postpone its annual basic assembly (AGM) - which was set for 25 July - to resolve on a brand new director who could be a consultant of the household.

Rani Kapur did not specify who she meant by "some individuals", however Sona Comstar held the AGM the following day anyway and appointed Sunjay's spouse Priya as a non-executive director.

In her letter, Rani Kapur claimed she was the only beneficiary of her late husband's property in a will left behind in 2015 which included a majority stake in Sona Group, together with Sona Comstar.

The corporate has strongly denied Rani Kapur's claims and mentioned that she has had "no function, direct or oblique, in Sona Comstar since at the least 2019".

The board additionally mentioned it had no compulsion to defer to her discover and that the AGM was performed "in full compliance with the legislation". The corporate has issued a authorized discover to Rani Kapur, asking her to cease spreading "false, malicious and damaging" statements.

The BBC has contacted Sona Comstar, Rani Kapur and Priya Sachdev with questions.

Public shareholders, together with banks, mutual funds and monetary establishments, maintain 71.98% of Sona Comstar, which is listed on Indian exchanges as Sona BLW.

The remaining 28.02% is held by promoters by way of an organization known as Aureus Investments Pvt Ltd.

In keeping with the corporate's filings, Sunjay Kapur was the only beneficiary of the RK Household Belief, which controls the promoters' stake in Sona Comstar by way of Aureus Investments.

"Trying on the firm construction, at this level of time, Rani Kapur does not characteristic as a registered shareholder so will not have any voting rights. However there may be the matter of the RK Household Belief and Aureus investments. We will not actually know if Rani holds any direct curiosity there until the settlement is made public," says Tushar Kumar, a company litigator at India's Supreme Courtroom.

The Kapur household's feud is not an remoted case.

Some 90% of listed firms in India are family-controlled, but solely 63% have a proper succession plan in place, in response to a PwC survey.

Kavil Ramachandran of the Indian College of Enterprise says most Indian household companies function with "important ambiguity about specifics".

"One such [area] is who owns how a lot and who inherits and when," he provides.

Specialists say household involvement with out meritocracy and absence of formal agreements complicate issues.

"On the demise of the patriarch (and even earlier than), disputes come up, each on possession and on administration, and an excessive amount of water would have flowed underneath the bridge for points to be resolved amicably," mentioned Ketan Dalal, who advises a number of Indian enterprise households on possession constructions.

<img sizes="(min-width: 1280px) 50vw, (min-width: 1008px) 66vw, 96vw" srcset="https://ichef.bbci.co.uk/news/240/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 240w,https://ichef.bbci.co.uk/news/320/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 320w,https://ichef.bbci.co.uk/news/480/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 480w,https://ichef.bbci.co.uk/news/640/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 640w,https://ichef.bbci.co.uk/news/800/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 800w,https://ichef.bbci.co.uk/news/1024/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 1024w,https://ichef.bbci.co.uk/news/1536/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp 1536w" src="https://ichef.bbci.co.uk/news/480/cpsprodpb/616b/live/f3edb5f0-7416-11f0-b93a-3f3bb059a8f9.jpg.webp" loading="lazy" alt="Getty Images Tycoon brothers Reliance Chairman Mukesh Ambani and Reliance ADA Group Chairman Anil Ambani during the launch of Digital India Week by Prime Minister Narendra Modi at IGI Stadium on July 1, 2015 in New Delhi, India. " class="sc-d1200759-0 dvfjxj"/> Getty Photos Asia's richest man Mukesh Ambani (left) was as soon as embroiled in a really public energy wrestle together with his youthful brother Anil

India Inc. is strewn with bitter succession battles that repeatedly seize headlines.

Mukesh Ambani, Asia's richest man, was as soon as embroiled in a really public energy wrestle together with his youthful brother over the sprawling Reliance empire after their father Dhirubhai Ambani died in 2002 with out leaving a will. It was their mom, Kokilaben, who brokered peace years later.

Extra just lately, household feuds have erupted on the Raymond Group, India's most well-known textiles firm, and among the many Lodha brothers, whose firm constructed the Trump tower in Mumbai.

All of this has usually come at an amazing price to Indian shareholders.

"Anybody who has saved infinite management of their palms has suffered. In the long run it is the corporate that suffers, the inventory costs go down and [so does] the notion of how the corporate will do sooner or later," says Sandeep Nerlekar, founder and managing director of legacy planning agency Terentia.

However some households at the moment are as soon as bitten, twice shy.

The Bajaj household, one of many nation's greatest conglomerates, confronted inside wrangling over succession till a courtroom stepped in throughout the 2000s to resolve the dispute.

The patriarch mapped out a succession plan for the group, dividing tasks between his sons and cousin. As per the corporate's assertion, the group now operates by way of consensus by way of a household council.

Final yr, certainly one of India's oldest enterprise homes, the locks-to-real property Godrej Group, introduced an uncharacteristically amicable separation of their multi-billion greenback enterprise.

"Households must work on succession planning with governance constructions like board that has tooth. They need to be given some management in order that the enterprise can develop long run. Additionally it is advisable to enable the following technology to take the lead nicely in time and the patriarch ought to take the time to groom them in order that household points do not occur," says Mr Nerlekar.