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The fight will take GHCL down!
Motives of personal gains amongst brothers have shaken-up foundations of many dynasties. From the Birlas to the Ambanis and the Singhs of Ranbaxy, all have borne the brunt of a fight amongst siblings... And here’s the latest of the lot – an internal feud between the promoters of Gujarat Heavy Chemical Limited (GHCL), one of India’s oldest chemical companies and a growing textile giant. With its corporate restructuring plan gone awry, all thanks to the increasing drift between brothers Sanjay Dalmia (with an 18.5% stake in GHCL) and Anurag Dalmia (with a 22% stake), the future of the Rs.10.99 billion titan looks dismal. So how can this ‘brother-against-brother’ saga really affect the future prospects of GHCL?
Family feuds over business shares brew up in the absence of proper authority and power distribution. Sanjay Dalmia (current Chairman), during the Extra Ordinary General Meeting (EGM) held in March 2008 had foreseen a different future when he quoted, “The restructuring initiative would lead to creation of independently focussed organisations with a potential to achieve fast growth in their individual arenas.” The restructuring plan however went for a complete toss with misunderstandings over management style between the two brothers. Moreover, with its two major ventures in the pipeline (the first one being its launch of retail stores in the Indian market in a tie-up with the Rosebys brand, and the second being a launch of its $700 million multi-product transnational company which would supply soda chemicals to hotel chains, hospitals et al in US), the time is not right for all the confusion that prevails at GHCL as even N. Wadhwa, Director, SKI Capital agrees, “Though the GHCL stock price has shot up by 28.6% over the last month, but with this kind of controversy cropping up, there would be a doubt in the mind of the financial investors about future uncertainties.” This can also mar the proposed investment plan of Middle East’s Al Rostamani Group to buy a stake in GHCL. It is thus imperative for the Dalmia brothers to sort out their differences for the greater interest of the company.
Ratan Lal Bhagat
For more articles, Click on IIPM Article.
Source : IIPM Editorial, 2008
An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist).
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The fight will take GHCL down!
Motives of personal gains amongst brothers have shaken-up foundations of many dynasties. From the Birlas to the Ambanis and the Singhs of Ranbaxy, all have borne the brunt of a fight amongst siblings... And here’s the latest of the lot – an internal feud between the promoters of Gujarat Heavy Chemical Limited (GHCL), one of India’s oldest chemical companies and a growing textile giant. With its corporate restructuring plan gone awry, all thanks to the increasing drift between brothers Sanjay Dalmia (with an 18.5% stake in GHCL) and Anurag Dalmia (with a 22% stake), the future of the Rs.10.99 billion titan looks dismal. So how can this ‘brother-against-brother’ saga really affect the future prospects of GHCL?Family feuds over business shares brew up in the absence of proper authority and power distribution. Sanjay Dalmia (current Chairman), during the Extra Ordinary General Meeting (EGM) held in March 2008 had foreseen a different future when he quoted, “The restructuring initiative would lead to creation of independently focussed organisations with a potential to achieve fast growth in their individual arenas.” The restructuring plan however went for a complete toss with misunderstandings over management style between the two brothers. Moreover, with its two major ventures in the pipeline (the first one being its launch of retail stores in the Indian market in a tie-up with the Rosebys brand, and the second being a launch of its $700 million multi-product transnational company which would supply soda chemicals to hotel chains, hospitals et al in US), the time is not right for all the confusion that prevails at GHCL as even N. Wadhwa, Director, SKI Capital agrees, “Though the GHCL stock price has shot up by 28.6% over the last month, but with this kind of controversy cropping up, there would be a doubt in the mind of the financial investors about future uncertainties.” This can also mar the proposed investment plan of Middle East’s Al Rostamani Group to buy a stake in GHCL. It is thus imperative for the Dalmia brothers to sort out their differences for the greater interest of the company.
Ratan Lal Bhagat
For more articles, Click on IIPM Article.
Source : IIPM Editorial, 2008
An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist).
Read these article :-
B-schooled in India, Placed Abroad (Print Version)
IIPM in Financial times (Print Version)
IIPM makes business education truly global (Print Version)
The Indian Institute of Planning and Management (IIPM)
IIPM Campus
ZEE BUSINESS BEST B SCHOOL SURVEY
For More IIPM Info, Visit below mentioned IIPM articles.
1500-plus IIPM students placed across the country with 44 bagging international offers
IIPM set to beat economic slowdown
IIPM, GURGAON
IIPM - Admission Procedure
IIPM awards four Bengali novelists
The Hindu : Education Plus : Honour for IIPM
IIPM ranked No.1 B-School in India, Management News - By ...
IIPM Ranked No1 B-School in India
Moneycontrol >> News >> Press- News >> IIPM ranked No1 B-School in ...
» IIPM ranked No1 B-School in India :: Education, Careers ...
The Hindu Business Line : IIPM placements hit a high of over 2000 jobs
Deccan Herald - IIPM ranked as top B-School in India
India eNews - IIPM Ranked No1 B-School in India
IIPM Delhi - Indian Institute of Planning and Management New Delhi ...
domain-b.com : IIPM ranked ahead of IIMs
IIPM makes business education truly global-Education-The Times of ...
