Amid the family feud between Baba Kalyani and his sibling, Sugandha Hiremath, agrochemical company, Hikal has disclosed the family arrangement in a stock exchange filing to comply with SEBI regulations. Hikal is the third company to make these disclosures. Kirloskar Brothers (KBL) chairman and MD, Sanjay Kirloskar and the Gupta family of Jagran Prakashan Group have recently disclosed their family agreements.
Companies are making this disclosure as per SEBI’s LODR requirements, where promoters must disclose to exchanges their family settlement agreements or arrangements that have a bearing or influence on management control of listed entities for such deals to remain legal.
KBL’s Kirloskar recently disclosed details of the family settlement in a similar stock exchange filing. The Kirloskar family `Deed for Family Settlement’ is between promoter family members, Sanjay (KBL) Atul and Rahul Kirloskar (KOEL and Kirloskar Industries). The brothers have gone to court about this settlement and the case is pending in the Supreme Court.
Jagran Media Investment, the holding company of Jagran Prakashan, has made disclosures about the family agreement between promoters who are members of the Gupta family. The agreement was at the Jagran Media Network Investment level, which impacts the management of the listed entity of the listed company, Jagran Media.
According to the Hikal disclosures, the promoter family agreed on June 19, 1994, between Baba Kalyani and his father N A Kalyani in the presence of his mother, Sulochana Kalyani for the transfer of stake held by the companies owned and controlled by the Baba Kalyani family to his sister, Sugandha Hiremath.
The family arrangement was about the transfer of the 34% stake held by the companies owned and controlled by the Kalyani Family in Hikal to Sugandha Hiremath. Baba Kalyani and his family hold 34.01% of Hikal through Kalyani Investment Company and BF Investment.
Sugandha is Jai Hiremath’s wife and he is the founder of Hikal, currently serving as the executive chairperson of the company. The Hiremaths on their own had a 34.84% ownership in Hikal.
After N A Kalyani passed away, his daughter Sugandha Hiremath, was to be the beneficiary of the agreement. The Hikal disclosures said after the execution of the family agreement, the Hiremath family would own 68.85% of Hikal, resulting in majority voting rights for the Hiremath family.
According to Hikal, Baba Kalyani failed to perform his obligations as per the agreement. So Sugandha and Jai Hiremath filed a suit with the Bombay High Court on March 23 seeking specific performance of the arrangement.