Vadilal Industries Limited, the Rs 1,200-crore ice-cream and frozen food manufacturer, has announced a major restructuring plan aimed at resolving long-standing family disputes and securing the future of its iconic brand. The restructuring includes a family settlement, board reshuffle, and the merger of key promoter entities, according to the company’s exchange filing on Sunday. The decision follows months of negotiations among the Gandhi family members, who have played a pivotal role in building the company into a household name in India’s ice-cream and frozen foods sector.
As part of the settlement, the Gandhi family has opted to separate ownership from management. While the family will retain control as promoters, operational leadership will be transitioned to professional managers. This move aims to enhance shareholder value and ensure long-term sustainability.
A key element of the restructuring involves merging three promoter-held entities—Vadilal International Private Limited (VIPL), Vadilal Finance Company Private Limited (VFCPL), and Veronica Constructions Private Limited (VCPL)—into Vadilal Industries. VIPL, which owns the ‘Vadilal’ trademark, currently licenses it to the company. Bringing the brand under direct ownership will eliminate royalty payments, streamline operations, and strengthen the company's market position.
The merger will be executed via a share swap arrangement, with shareholders of VIPL, VFCPL, and VCPL receiving Vadilal Industries shares at pre-determined ratios. Post-merger, the promoter group’s stake will rise from 64.73% to 72.34%, adjusting public shareholding accordingly.
As part of the governance overhaul, significant leadership changes have been announced. Rajesh R. Gandhi and Devanshu L. Gandhi, the current Managing Directors, will step down once pending litigations are resolved. Kalpit R. Gandhi (CFO) and Deval D. Gandhi (Non-Executive Director) will also resign, marking a shift toward professional management.
In their place, Janmajay V. Gandhi, a next-generation leader from the VRG family branch, will join as an Executive Director. Additionally, the board will induct three high-profile independent directors: Shalini Raghavan, former Group CMO of Nykaa, with expertise in consumer branding; Shivakumar Dega, an experienced executive from PepsiCo, Nokia, and Philips; and Nagarajan Sivaramakrishnan, ex-CEO of Mother Dairy, with a strong background in FMCG and dairy. Gaurav Marathe, a financial strategist from Lincoln International, will also join as a Non-Executive Director.
The settlement grants significant affirmative voting rights to the Gandhi family on critical corporate matters, including restructuring, brand-related decisions, capital structure changes, and potential delisting. These veto powers will provide stability during the transition while professional managers oversee daily operations.
To maintain family control, share transfer restrictions have been implemented. A right of first refusal ensures family members receive priority if any branch intends to sell shares. Additionally, a tag-along right protects minority family members—if any branch sells shares resulting in a third party acquiring more than 10% of the company, other family members can participate in the transaction if those shares are later sold to competitors. These measures aim to prevent hostile takeovers while allowing controlled liquidity.
The restructuring is subject to approvals from the National Company Law Tribunal (NCLT), shareholders, and regulatory authorities, including SEBI. A postal ballot will soon be initiated to secure investor consent for the proposed changes.