NEW DELHI: YET another high-profile family feud has come to the fore and is set to leave a scar on the Indian corporate world. KK Modi, the patriarch of one of the oldest business houses in India who passed away in November 2019, left behind a trust deed, the legal clauses of which have now set the ground for sale of Godfrey Phillips India (GPI) and all the other assets of the family.
To begin with, Lalit Modi, who is a key member of the family trust, has recently tweeted that “all assets of KK Modi group were up for sale”, implying that companies including Modicare, Modicare Healthcare Placement and 24Seven convenience stores were up for sale while Colorbar, Ego, Beacon Travels and the education businesses will be retained to be run by his mother Bina Modi, along with her son Samir Modi and daughter Charu Modi. Lalit had also clarified that he did not approve of Bina Modi, wife of KK Modi, running the business empire “as she is not qualified to run such a large corporation and will dilute our value”. However,
the boardroom coup took a bitter turn when cigarette maker Godfrey Phillips India denied reports that its promoter KK Modi Group was planning to sell its stake in the company, evoking a strong rebuttal from Lalit Modi, who called it “blatant liars”. Sharing a letter he had written to co-trustees of KK Modi Family trust ahead of a meeting of the board of trustees on November 30, 2019, in which he proposed selling of various assets including family-controlled businesses, Modi said,
“We agreed to unanimously go forward (in the meeting of the trustees). Which was the only item on Agenda.” He also termed the clarification by Godfrey Phillips India as “a complete eye wash”. Earlier in a regulatory filing, Godfrey Phillips India had clarified that it is neither engaged nor privy to any such discussions on “rumoured potential transaction by its promoters”.
“The company has also received a clarification from its significant promoter that there has been no decision to put its assets on sale,” it noted. Under the trust deed, the next step is that the entire process of sale has to be concluded within a year and the proceeds distributed in the manner stated. Shares of Godfrey Phillips India dived 3.65 per cent to `1,386.3 on BSE.