The Godrej Group is reportedly in the final stages of complex negotiations to formally divide its diverse businesses.
What Happened: The conglomerate’s division of assets worth ₹1.76-lakh-crore will involve two factions of the Godrej family – Godrej Industries & Associates led by Adi Godrej and his brother Nadir, and Godrej & Boyce Manufacturing Company (G&B) involving cousins Jamshyd Godrej and Smitha Godrej Crishna, Economic Times reported, citing sources.
The split will encompass business verticals spanning engineering, appliances, security solutions, agricultural products, real estate, and consumer products.
Key specifics under discussion include the usage of the Godrej brand name post-split, potential royalty payments and the valuation of land assets currently held by G&B. Challenges also involve addressing equity cross holdings and the division of approximately 3,400 acres of valuable land parcels held under G&B, the business daily repored.
How It’s Going: Despite these complexities, sources told the publication that the discussions are being conducted amicably, with a focus on the best interests of all stakeholders, including consumers. The impending division is not expected to impact the operations of the involved companies.
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Notable figures in the industry are advising the respective parties in this division, with Nimesh Kampani and Zia Mody reportedly assisting Jamshyd Godrej, and Uday Kotak and Cyril Shroff’s legal firm Cyril Amarchand Mangaldas leading discussions from Adi Godrej’s side. Pirojsha Godrej, son of Adi Godrej and chairman of Godrej Properties, is also directly involved in the proceedings.
The ultimate aim of this division is to establish a streamlined shareholding and business structure to enhance future shareholder value.
Price Action: Most listed Godrej firms were trading higher on Tuesday, with both Godrej Consumer Products and Godrej industries gaining 1.42% in morning trade.
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