The two factions of the Hinduja family have been sparring long before the Hinduja Bank dispute came to light days ago.
Markets and the world at large missed the first signs of crack in the family that emerged as far back as September last year.
Sparks flew at the board of the group’s Rs 4,861-crore business process management company Hinduja Global Solutions, a listed company, between Srichand Parmanand Hinduja’s two daughters – Vinoo and Shanu – and Prakash Hinduja’s son Ramkrishan Hinduja over running the company.
Ramkrishan was the Chairman, Shanu was the co-chairperson, while Vinoo was a director in the eight-member board of the company. They all left the board by resigning in September 2019.
People familiar with the developments say the differences among the family members impacted the functioning of the board and also the business. The tension within the family was building up for over a year.
Vinoo and Shanu, both directors on the board, represented their father Srichand in Hinduja Global Solutions. In fact, he was the one who founded the company. He is still the chairman of Hinduja Group. They exited the board due to strained relationship in the family. Ramkrishan also left the company because of the same reason.
People in the know say there was an agreement to disengage the family from both sides for the benefit of the company. It helped the group function smoothly by making way for professionals to run the show.
The eight-member board of the Hinduja Global Solutions, with a substantial 67.24 per cent promoter stake, now has no member of the Hinduja family on it.
Hinduja Global Solutions reported revenues of Rs 4,861 crore with profits of Rs 176 crore in 2018-19. The company has clients across the US, Europe Asia and Middle East. This listed company on the Indian bourses has a market cap of Rs 1367 crore.
Hinduja family’s dispute has come out in the open as Srichand and his three younger brothers – Gopichand, Prakash and Ashok – are involved in multiple litigations in the courts of the UK, New Jersey and Switzerland. The main dispute is over a letter signed by the four brothers six years ago over their rights in the group assets. Srichand, who played a key role in building the group, is now disowning the letter by saying that it has no legal effect whatsoever.
While the disputes are on, the three brothers have issued a statement saying that the ongoing litigations will not have any impact on global businesses, which will continue to function as they have so far. “We hope you will understand that these are private family matters which are now the subject of litigation and we cannot comment any further,” the release stated.