COMPANIES

No Data Found

NEWS

No Data Found
Advertisement
Baba Kalyani rejects nephew and niece's claim in family wealth as partition battle turns ugly

Baba Kalyani rejects nephew and niece's claim in family wealth as partition battle turns ugly

Baba Kalyani called the suit filed by Sameer and Pallavi an attempt to usurp rights in the Kalyani HUF, adding that it should be dismissed on the ground that plaintiffs have no locus standi.

Business Today Desk
Business Today Desk
  • Updated May 8, 2024 7:44 AM IST
Baba Kalyani rejects nephew and niece's claim in family wealth as partition battle turns uglySameer and Pallavi had filed a suit in a Pune court seeking partition of the Kalyani family assets, which includes Bharat Forge and other listed and privately held companies. 

Babasaheb Kalyani, Bharat Forge MD, has said his nephew Sameer Jai Hiremath and niece Pallavi Swadi have no right to seek partition of the Kalyani Hindu undivided family’s (HUL) assets as they are not part of it under present law.

Sameer and Pallavi are children of his estranged sister Sugandha Hiremath.

Advertisement

Related Articles

Kalyani said Hiremath and Swadi cannot claim to be coparceners in the Kalyani joint family as they belong to Hiremath family by birth. Baba Kalyani's response is part of an affidavit filed against an application by the siblings for an ad-interim relief, urging the court to prohibit Baba Kalyani from conducting any transactions related to the properties of the Kalyani Hindu Undivided Family (HUF).

Sameer and Pallavi had filed a suit in a Pune court seeking partition of the Kalyani family assets, which includes Bharat Forge and other listed and privately held companies. 

Baba Kalyani called the suit an attempt to usurp rights in the Kalyani HUF, adding that it should be dismissed on the ground that plaintiffs have no locus standi to file the suit. He said the suit mentions an alleged Kalyani HUF and lists certain properties under it.

Advertisement

It gives no details on how they became HUF properties, he said, adding that such “self-serving averments” were not enough to bring the properties under the purview of the partition suit.

Hikal at the centre of dispute

Last year, the Hiremath family moved the Bombay High Court on the grounds that Kalyani was not honouring a family arrangement to transfer all Hikal Limited shares to them. This is a listed entity, where the Baba Kalyani group holds 34% in the company, while the Hiremath family’ share is 34.84%. The other 31.15% is public shareholding.

So what is the relatively unknown Hikal Limited all about?

It is a diversified company manufacturing active pharmaceutical ingredients (APIs) apart from having a presence in crop protection and animal healthcare. For FY23, it had a total revenue of Rs 2,028 crore with a net profit of Rs 78 crore; for the previous fiscal, revenue was at Rs 1,948 crore and a net profit of Rs 161 crore.

Advertisement

A note put out by ICRA on Hikal early this month specifically brings up the issue of the dispute and Baba Kalyani resigning from his position as non-executive non-independent director from the board of Hikal. “Based on the discussion with Hikal’s management, ICRA understands that these developments have not had any adverse impact on the company’s operations or its banking arrangements. However, ICRA will continue to monitor the developments in this regard and its possible impact on the credit risk profile of the company, if any,” it stated.

According to the note, which is a reaffirmation of the company’s ratings, Hikal has undertaken a sizeable debt-funded capital expenditure (capex) of more than Rs. 700 crore over FY22-24 for multipurpose crop protection and animal healthcare facilities in addition to capacity enhancement in its pharmaceutical business.

“Since this capex was partly funded through long-term debt, the overall debt position of the company has remained elevated with total debt (including lease liability) of Rs. 773.5 crore as on September 30, 2023. Coupled with moderation in the company’s internal accruals, this has resulted in moderation of its coverage indicators,” it said. The animal healthcare facility was commissioned in December 2023, while the multipurpose crop protection facility will be commissioned over the next few quarters. 

Published on: May 8, 2024 7:44 AM IST
    Post a comment