The tug-of-war between Reckitt Benckiser and the Chennai-based TTK group has taken an ugly turn with the former filing a case in London against its Indian partner for damages. It is learnt that the British company filed a case in the London court last week.

British company Reckitt Benckiser is the partner in TTK-LIG, which manufactures ‘Durex' and ‘Kohinoor' brand condoms. Last month, Reckitt moved the Company Law Board, complaining that it did not have equal representation on the TTK-LIG board and that the Chennai company was not supplying condoms to the UK parent.

Sources close to the development cited two major grounds — board rights and ‘oppression and mismanagement'. For the latter, Reckitt cited stoppage of supply of condoms to SSL of the UK, which is a part of Reckitt Benckiser.

From May 2, TTK-LIG has stopped supply to SSL. With exports to the UK amounting to 80 per cent of TTK-LIG revenues, the company has been hit due to stoppage of supply. It is estimated that TTK-LIG supplies about 600-700 million condoms a year to Reckitt SSL from its three manufacturing facilities.

In the proceedings before the CLB on Wednesday, Reckitt said that the TTK group is bleeding the joint venture deliberately. TTK's defence was that there was no long-term commitment from Reckitt SSL and, hence, it did not want to supply. Reckitt SSL buys half its requirements from TTK-LIG. Reckitt Group Company has filed the suit in London court as the purchase order emanates from London.

The CLB heard arguments of both sides and has reserved judgment.

Related Topics
comment COMMENT NOW