Mahindra prince Anand Mahindra crowned king

Written by fe Bureau | Mumbai | Updated: May 31 2012, 09:40am hrs
Another Indian business family is passing on the baton. Anand Mahindra, vice-chairman and managing director of Indias largest tractor and sports utility maker, will take over as executive chairman of the $15.4-billion Mahindra Group from uncle Keshub Mahindra after the proposal receives shareholders approval on August 8.

Mahindra senior, 88, will now be chairman-emeritus after being chairman of the diversified group for 49 years. In his place comes the nephew, who was groomed from an executive assistant to the managing directors post in 1997.

Keshub Mahindra sowed the seeds of transforming a steel trader to a diversified group in 1984, after making a futile attempt to purchase the Indian Aluminium Company. However, ever since Anand Mahindra took over in 1997, the group acquired a new flavour.

The Harvard grad transformed the group, expanding from tractors to SUVs, entering real estate development, creating Indias largest time share holiday company, building special economic zones and entering financial services and defence manufacturing.

Some acquisitions helped gain domestic market share while others helped geographical diversification to to de-risk its business. Its purchase of Sangyong Motors of South Korea helped it make sports utility vehicles in the worlds second-largest economy. Back home, BPO firm Tech Mahindra, a joint venture with British Telecom, purchased Satyam Computer Services to make it one of the largest software exporters.

However, the group which Anand Mahindra calls a federal group of companies, still has a bigger challenge in the low promoter shareholding of 25.6%, making vulnerable to takeover threats.

I think there needs to be clarity when it comes to succession planning and Mahindra and Mahindra have done it well, said Munish Thakur, a professor of strategic management at XLRI Jamshedpur, a business school. There has always been only one choice for the post of chairman and thats Anand Mahindra. I dont see the organisation facing any major changes as he has been in charge for a long time and taking the key decisions.

It is gratifying to be able to hand over to the next generation at a time when the companys performance is at its best, said Keshub Mahindra. Anand Mahindra said his uncle has been a role model for business leaders and a true statesman.