The dispute in the Kirloskar family has reached SEBI’s doors. Vijay Kirloskar, chairman, Kirloskar Electric, has written to SEBI chairman after one of the Pune faction of the family sent letters to stock exchanges that implied four companies within the $3-billion (about Rs 23,000-crore) group were allowed to use the ‘Kirloskar’ brand.
Times of India reported that the letter said it was against a court order of 2015 that allowed all the companies within the 130-year business group to use the brand. This development comes days after the Supreme Court advised Kirloskar family members to settle all disputes amicably in the last week of July.
Interesting Fact
- Last year, a company controlled by Atul and Rahul Kirloskar had blocked the re-appointment of an independent director to the board of Kirloskar Brothers.
- The Kirloskar family feud has worsened further with Bengaluru-based Vijay Kirloskar, chairman of Kirloskar Electric Company (KECL), filing a complaint with SEBI seeking action against four companies run by his nephews — Rahul and Atul Kirloskar — for alleged.
The letter by Bengaluru-based Vijay Kirloskar to SEBI was in response to stock exchange disclosures by Kirloskar Oil Engines, Kirloskar Industries, Kirloskar Pneumatic and Kirloskar Ferrous Industries, which separately but in identically worded letters said these four companies were rebranding the ‘Kirloskar’ logo to continue to grow their businesses. In the letter to SEBI, Vijay Kirloskar alleged that these four companies were misleading investors by false representation, a violation of Sebi rules.
The latter has also been sent to the two stock exchanges, NSE and BSE. These four companies are run by Pune-based Atul and Rahul, nephews of Vijay Kirloskar. He alleged that Atul and Rahul were attempting to create uncertainty in the minds of investing public and undermine the intrinsic value of Kirloskar Electric’s shareholders by giving false statement.
Vijay Kirloskar requested Sebi to act against four companies run by his nephews for misleading investors by giving false statements and for trying to “usurp” the 130-year-old legacy of the brand name ‘Kirloskar’.
He was seeking regulatory action under Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Sebi (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003. If the regulator acts on the letter, it would be second regulatory action against Atul and Rahul since Sebi’s October 2020 order against the two and their associates that ordered total payment of Rs 31 crore plus interest for violations of various regulatory prohibitions.
Since 2010, the various factions within the Kirloskar family have been fighting a business battle either for the control of various companies within the group or trying to enter each other’s businesses. This, despite a 2009 family settlement agreement between all the factions within the group and then a failed attempt by Vijay Kelkar, the former finance secretary, in 2017. (TOI)
