The document summarizes the history of a large Indian conglomerate founded in 1933 to produce sugar. It later expanded into other industries like chemicals and rubber. In the late 1970s, it became the 7th largest conglomerate in India with assets over 900 crore rupees. A feud emerged between the sons of the two family heads over dividing control of the companies after one passed away. This led to ongoing legal battles between different branches of the family over the next few decades as they struggled to divide ownership and control of the business empire.
The document summarizes the history of a large Indian conglomerate founded in 1933 to produce sugar. It later expanded into other industries like chemicals and rubber. In the late 1970s, it became the 7th largest conglomerate in India with assets over 900 crore rupees. A feud emerged between the sons of the two family heads over dividing control of the companies after one passed away. This led to ongoing legal battles between different branches of the family over the next few decades as they struggled to divide ownership and control of the business empire.
The document summarizes the history of a large Indian conglomerate founded in 1933 to produce sugar. It later expanded into other industries like chemicals and rubber. In the late 1970s, it became the 7th largest conglomerate in India with assets over 900 crore rupees. A feud emerged between the sons of the two family heads over dividing control of the companies after one passed away. This led to ongoing legal battles between different branches of the family over the next few decades as they struggled to divide ownership and control of the business empire.
The document summarizes the history of a large Indian conglomerate founded in 1933 to produce sugar. It later expanded into other industries like chemicals and rubber. In the late 1970s, it became the 7th largest conglomerate in India with assets over 900 crore rupees. A feud emerged between the sons of the two family heads over dividing control of the companies after one passed away. This led to ongoing legal battles between different branches of the family over the next few decades as they struggled to divide ownership and control of the business empire.
COMPANIES BEGINNING • Founded in 1933, a plant was setup 40 km north-east of Delhi
• Plant was setup for production of sugar.
• Then moved into vanaspathi, rubber, paper,
chemicals etc. GROWTH • 7th largest conglomerate by late 70’s
• Assets over Rs.900 cr. and sales of Rs.1600 cr.
START OF THE FUED • Gujarmal and Kedar Nath were the business heads of the company. • After Gujarmal’s death the companies were headed by Kedar Nath. • Kedar Nath initiated action to divide the share among his three sons. • Feud among the sons of Gujarmal and Kedar Nath as a result. Start of the feud(contd.)
• Kedar Nath used political connections to
attack the Modi family • Accusations on Modi family for violating FERA Act and Over-invoicing of imported machinery ,no intention of paying FI’s were charged. • Modi group removed Kedar Nath from Modi Rubber in 1998. Solution to the Feud • The companies were divided in 60:40 ratio.
• Gujarmal’s 5 sons held 60% while Kedar Nath’s
3 sons held 40% share.
• Modi rubber held by Gujarmal’s sons and
Modi mills came under Kedar Nath’s camp. KK Modi VS MK Modi • Settlement divided into two- chemical to MK Modi and fibre to KK Modi • Went to court in 2002 result of notice issued by UPSIDC. • MK moved court for attaining UPSIDC shares. • KK opposed the movie due to fear of loss of its position • Court allowed purchase of UPSIDC to MK and tried to mediate between the two brothers. BK Modi vs VK Modi • Fight for attainment of Modi rubber. Agreement made where both gained 24%. • Rift between BK and VK regarding contract manufacturing with Apollo tyres. • On 30th June 2001, BK Modi stripped of all his functional authorities. • BK battled back claiming it was breach of shareholder’s agreement. • VK was eventually the winner as his stake went up by 66%.