Nusli Wadia isn't a man who backs down easily. Whether it was in his battle with his father Neville Wadia over the latter's decision to sell the family jewel, Bombay Dyeing, to RP Goenka in the 1970s or his fight on behalf of French giant Danone with Rajan Pillai for control of Britannia Industries, or even his more recent decision to support Cyrus Mistry in his boardroom tussle with Ratan Tata, Wadia has built a reputation for feistiness.
But 20 years ago, even this redoubtable corporate chieftain found in jute baron Arun Kumar Bajoria a formidable and highly slippery adversary.
Bajoria built his fortune and his reputation in the 1990s after turning around distressed and hemorrhaging jute mills which he had acquired on the cheap. With a sizable war chest he then turned corporate raider of undervalued stocks. Among the first of these was the shares of Bombay Dyeing which he first took a shine to in 1999 and promptly started buying up.
By the time Wadia, who at that point owned 40 percent of the company, became aware of the threat of the Calcutta-based businessman, Bajoria had built a 14 to 15 percent holding in the textile major. As per the takeover law he was now required to make an open offer to the shareholders except that he had no intention of doing so. Even as he battled charges of having flouted the takeover code he made it clear that he had little interest in taking over the company.
Instead like all good stock raiders, he was merely looking to sell these shares back to the company at a profit. The market, having taken note of his keen interest in the company, sent their price soaring.
Eventually, Bajoria came away with a whopping gain though he did suffer a rap on his knuckles from the Securities and Exchange Board of India (Sebi) which barred him from dealing in securities for a year. This didn't prevent him from making money on what he had already acquired. Cannily, he had already transferred these shares to associate firms that didn't fall within the purview of the Sebi order and were, therefore, able to trade in them.
A year later and given a reprieve by Securities Appellate Tribunal which set aside the earlier Sebi order, he was back at Wadia's gates once again mopping up a fair chunk of Bombay Dyeing shares. The same modus operandi followed with Bajoria laughing his way to the bank.
Through the years other companies like Ballarpur Industries and Kanoria Chemicals had also come in Bajoria’s crosshairs and he pulled much the same trick with them.
Bajoria died in Mumbai in March 2008. Ironically after his death, his estate fell into dispute since he hadn’t left a will for his wife and four daughters.
(Edited by : Pranati Deva)