The ₹74,220-crore Murugappa group, one of India’s leading business conglomerates, on Sunday, said it had settled the dispute between Valli Arunachalam, the eldest daughter of MV Murugappan, former Murugappa Group Executive Chairman, and the rest of the family members.
The family settled the disputes and differences, which arose after the demise of MV Murugappan, between the family branch of the late MV Murugappan (including Valli Arunachalam and Vellachi Murugappan) on one side, and the rest of the family members, on the other, said a statement.
They concluded the terms of the family arrangement at a meeting in the presence of their respective advisors, following which a memorandum was signed between the two daughters of the late patriarch and the remaining members of the family.
The family members are committed to undertaking the necessary transactions to effect the family arrangement within the next 90 days.
As part of the arrangement, the parties have also agreed that all legal proceedings between the family groups will be withdrawn as per the terms of the family arrangement, after all steps specified in the settlement have been completed.
However, details of the arrangement and agreed steps were not disclosed.
Valli Arunachalam, who is currently reported to be in the US, was not available for any comment.
For the past 4-5 years, she has been fighting a lone battle for a seat on the board of the holding company of the Murugappa Group, Ambadi Investments. She had accused her other family members of denying her a seat on the board because of her gender. She moved the courts after the group’s all-male board comprising her uncles and cousins, voted unanimously to reject her plea to be inducted into the board of the holding company.
Valli and her family also moved an application at the NCLT (National Company Law Tribunal), Chennai seeking a waiver of the minimum shareholding requirement of 10 per cent, in order to allow her to maintain her case against Ambadi Investments.
Now, they have concluded an arrangement, which is expected to help the Murugappa group to maintain harmony within the family.
“The family arrangement ensures that all the issues between the members will be settled, and they are happy that they have agreed to resolve this amicably. The terms of the family arrangement itself are confidential,” the statement said.
“The development is welcome to resolve the inheritance issues seamlessly. However, the members of the family may have to execute legally binding agreements on specific aspects of the arrangement that they have arrived at,” said Shailendra Dubey of Planmyestate Advisors LLP.
Stating the development as a welcome move from an investor perspective, Makarand Joshi, Founder, MMJC & Associates, said it is not clear whether the issues have been resolved based on a will drafted earlier or is based on mutual compromise. He said a seamless family settlement would augur well than a legal option of going to court.
No listed company forming part of the Murugappa Group is a party to the family arrangement, and nothing in the family arrangement relates to the management or control of or grants any special rights to the pares in, any such companies, it added.