Godrej family spat: Heirs reach out to mediators to rework pact over 1,000-acre landholding in Mumbai


At the 122-year-old Godrej Group, differences have cropped up between family members over the development of land holdings by Godrej & Boyce, the unlisted holding company of the conglomerate. The real estate business seems to be the primary cause of differences, media reports said.

The bone of contention is a 1,000-acre plot in Vikhroli, a distant suburb of Mumbai, concentrated with Godrej & Boyce and its commercial development by Godrej Properties—a listed arm of the Group headed by Adi Godrej, according to a report in The Times of India. This has led to two factions in the family—Godrej chairman Adi Godrej and his brother Nadir on one side and his cousins Jamshyd Godrej and Smitha Godrej Crishna leading the other faction. The Jamshyd Godrej faction is not in favour of excessive development of land, said a report in The Economic Times.

 Godrej family spat: Heirs reach out to mediators to rework pact over 1,000-acre landholding in Mumbai

File image of veteran industrialist Adi Godrej, Reuters

According to an agreement with the Group holding company, Godrej Properties headed by Adi Godrej’s son Pirojsha Godrej pays 10-15 percent revenue of the project to the landowner.

The group is the largest private landowner in Mumbai. According to government records, Godrej & Boyce owns 3,401-acre land holdings in Vikhroli, Nahuli and Kurla, the Business Standard said. The group companies from both sides also have minority stakes in each other and have representations on each other’s boards.

The Godrej family has hired lawyers to solve the stalemate. Adi Godrej, chairman of the Godrej Group and his brother Nadir, chairman of Godrej Agrovet have hired banker Uday Kotak and Cyril Shroff of Cyril Amarchand Mangaldas, while Jamshyd Godrej has hired veteran investment banker Nimesh Kampani of JM Financial and lawyer Zia Mody of AZB Partners to help in the re-organisation of the land holdings, media reports said.

The Godrej group’s three listed companies, viz, Godrej Consumer Products Ltd, Godrej Properties, and Godrej Agrovet are controlled by Adi and Nadir Godrej. Godrej & Boyce, the holding company of the Godrej Group has over a dozen diverse business divisions including aerospace, consumer, office and industrial products, furniture and appliances. These are owned by all family members and is helmed by Jamshyd Godrej as chairman.

“This [differences] is bound to happen as the business group moves toward new business plans and also when the number of family members increases, said Shriram Subramanian, Founder & Managing Director, InGovern Research, a proxy advisory and corporate governance firm. Succession plans and partition becomes important then, he said.

“If the rift, as stated in media reports, is over real estate, then that is a contentious issue. Unlike shares that can be given and transferred, land requires to be registered. There are tax considerations too. The media reports have not yet been confirmed by the Group and so we don’t know what the rift is about. Uday Kotak and Nimish Kampani are well-wishers. The issue will be resolved amicably as the Group has reached out to well-known mediators and reputed lawyers,” Subramanian said.

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