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CHENNAI: The Murugappa Group on Sunday said the members of the family have agreed to settle all disputes between the family branch of late MV Murugappan-including Valli Arunachalam and her sister Vellachi Murugappan-on one side, and the rest of the family on the other. The terms of the arrangement remain confidential.
Disputes arose after the demise of MV Murugappan, former Murugappa Group executive chairman. His eldest daughter Valli Arunachalam took the Murugappa Group family to the National Company Law Tribunal (NCLT) claiming she was neither being granted a board seat nor was her stake being bought out at a fair price, on grounds of gender. Arunachalam is the second cousin to Murugappa Group executive chairman MM Murugappan.
The members of the Murugappa family said in a statement that they discussed and concluded the terms of the family arrangement among themselves at a meeting and the understanding was recorded on Sunday by way of a memorandum entered into by both sides. Necessary transactions to affect the arrangement will be taken up within the next 90 days, the statement added.
Importantly, no listed company forming part of the Murugappa Group is party to the family arrangement, and nothing in it relates to the management or control of or grants any special rights to the parties in any such companies, the Murugappa Group said. As part of the arrangement, all legal proceedings between the family groups will also be withdrawn once the agreed steps have been completed, it added.
“The family arrangement is envisaged primarily to bring about amity and maintain goodwill amongst the members of the Murugappa family, and to maintain the overall harmony within the family, in this generation as well as in the future,” the statement said. “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,” it added.
According to industry analysts, the settlement is an attempt by the company to ‘buy peace’. “Like the TVS family settlement, this one, too, has made sure that the listed companies are not impacted by any settlement between family members… which means retail shareholders will not be impacted,” said an industry insider. Given that a number of the group companies are now helmed by the gen-next in the family, they could have had a role in the settlement, he added.
The problem between Valli Arunachalam, a US-based nuclear scientist, and the Murugappa family began after the death of her father, M V Murugappan, in 2017. MV Murugappan was the brother of MV Subbiah and MV Arunachalam, and the three had cordial relations.
Disputes arose after the demise of MV Murugappan, former Murugappa Group executive chairman. His eldest daughter Valli Arunachalam took the Murugappa Group family to the National Company Law Tribunal (NCLT) claiming she was neither being granted a board seat nor was her stake being bought out at a fair price, on grounds of gender. Arunachalam is the second cousin to Murugappa Group executive chairman MM Murugappan.
The members of the Murugappa family said in a statement that they discussed and concluded the terms of the family arrangement among themselves at a meeting and the understanding was recorded on Sunday by way of a memorandum entered into by both sides. Necessary transactions to affect the arrangement will be taken up within the next 90 days, the statement added.
Importantly, no listed company forming part of the Murugappa Group is party to the family arrangement, and nothing in it relates to the management or control of or grants any special rights to the parties in any such companies, the Murugappa Group said. As part of the arrangement, all legal proceedings between the family groups will also be withdrawn once the agreed steps have been completed, it added.
“The family arrangement is envisaged primarily to bring about amity and maintain goodwill amongst the members of the Murugappa family, and to maintain the overall harmony within the family, in this generation as well as in the future,” the statement said. “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,” it added.
According to industry analysts, the settlement is an attempt by the company to ‘buy peace’. “Like the TVS family settlement, this one, too, has made sure that the listed companies are not impacted by any settlement between family members… which means retail shareholders will not be impacted,” said an industry insider. Given that a number of the group companies are now helmed by the gen-next in the family, they could have had a role in the settlement, he added.
The problem between Valli Arunachalam, a US-based nuclear scientist, and the Murugappa family began after the death of her father, M V Murugappan, in 2017. MV Murugappan was the brother of MV Subbiah and MV Arunachalam, and the three had cordial relations.
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