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Billionaire Hinduja brothers call truce on bitter family feud

Billionaire Hinduja brothers call truce on bitter family feud

Billionaire Hinduja brothers call truce on bitter family feud
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By Moneycontrol News Nov 11, 2022 7:03:16 PM IST (Published)

The brothers agreed to halt reams of litigation across Europe, ending, for now, a feud that was tearing the once tightly knit British-Indian group apart.

The billionaire Hinduja brothers called a truce on a bitter power struggle that threatened the future of the business empire of the UK’s wealthiest family.

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The brothers agreed to halt reams of litigation across Europe, ending, for now, a feud that was tearing the once tightly knit British-Indian group apart.
With accusations of everything from a funding squeeze to misappropriated cash, the fight had drawn excoriating criticism from a London judge, especially over the care of the family patriarch, Srichand Hinduja — throwing open the possibility of a breakup of the ownership structures behind the century-old conglomerate.
SP, as the 86-year-old is known, suffers from dementia, and the court was told that the family’s dispute went so deep that he was days away from being transferred to a government-run NHS hospital.
At the heart of the battle was a pact signed by the four brothers in 2014 that “everything belongs to everyone and nothing belongs to anyone.” The three other brothers had claimed that the letter governed the succession planning for the century-old conglomerate, a declaration that was challenged by Srichand’s descendants, who claimed that his branch of the family was being sidelined in the group.
That battle ended after lawyers for Gopichand Hinduja said in June that the family had agreed to effectively tear up the arrangement.
With the end of the pact, however, the stage may now be set for the break up of one of the biggest conglomerates in the world. With dozens of companies — including six publicly traded entities in India — the Hinduja Group employs more than 150,000 people in 38 countries in truck-making, banking, chemicals, power, media and health care. Its firms include Ashok Leyland Ltd., Quaker Chemical Corp. and IndusInd Bank Ltd.
Deeply Divided
With a collective net worth of about $14 billion that would make the family the wealthiest in the UK according to the Bloomberg Billionaires Index, the four brothers had always presented a united front, with little to suggest that not all was well in the House of Hinduja.
But the family has been revealed to be deeply divided after court proceedings spilled into the open the internecine spat that pit brother Srichand’s side of the family, led by his daughter Vinoo, against the rest.
London appeal judges on Friday lifted reporting restrictions on court hearings centered around Srichand’s health and the care he was receiving following an 18-month legal battle by Bloomberg News and the Press Association and the UK’s Official Solicitor, ending years of secrecy that tied into a commercial case over the empire.
Judge Anthony Hayden said he’d been troubled by the extent to which SP had been marginalized by the family.
“He has been demoted to the back row of the court and he will be returned to the front,” the judge said. “Words and platitudes have not been made good.”
During the hearings, the funding from the family dried up to such an extent that lawyers brought in to act independently on behalf of Srichand said they were seriously considering moving him from his private hospital to a National Health Service facility. Gopichand’s lawyers say that more than £5 million had been made available.
‘Confounding Doctors’
Srichand, who remains frail, has “confounded his doctors,” according to the ruling. In March 2021, his doctors said he had a very short time to live.
But the disputes over Srichand's healthcare were still going as the hearings neared their end point in the summer of 2022. Judge Hayden said that despite the "extraordinary scope and reach" of the Hinduja family's wealth, he himself had considered moving SP to a public nursing home.
The judge agreed with arguments that the Court of Protection proceedings, which are designed to ensure care and oversight of vulnerable people, have at times been “used as leverage in the commercial litigation.”
Lawyers for Gopichand previously alleged in court documents that Vinoo and her side of the family misappropriated Srichand’s money, sought to separate him from his brothers and push for control over his assets, business interests “and ultimately over Srichand himself.”
Vinoo denied there was any misappropriation and said she and her sister acted in her father’s best interests and “in accordance with family traditions.” She said she'd been with him night and day, while he was in hospital.
The wider family cut off funding to such an extent, Vinoo’s lawyers said, that her branch "had no new money coming in from wider family resources.” It "was therefore drawing on funds held by Srichand personally," they said. Gopichand’s lawyers have disputed the characterization of a “financial squeeze.”
The Pact
The brothers have for decades been bound by the “one for all, all for one” pact.
But in the June legal filing, Gopichand accepted that the 2014 letter is no longer legally enforceable against his elder brother Srichand. The document couldn’t bind his brother, his lawyers said, in a bid to end the commercial London litigation.
The two once acted together as “one soul,” Gopichand, 84, told the judge in August, at times in tears.
“Once the family feud is nearly over, I know this is very difficult for you to understand, I am confident that he will become alert,” he said. “At times there is ego, there is jealousy, certain things that come up, that should be avoided.”
The Hinduja feud exemplifies the challenges faced by family-run groups. The organizational structure that worked for the brothers may not for third and fourth generation family members now taking the reins.
The Hindujas aren’t new to controversy. In the 1980s, they were investigated on allegations they took bribes to help Swedish gun-maker Bofors secure an Indian contract. The allegations were strongly denied and the case was later thrown out of court for lack of evidence. In the early 2000s, they were entangled in the U.K.’s “cash-for-passports” scandal, having donated money for the Millenium Dome when SP was applying for British citizenship.
This is a “war and peace” story, Gopichand’s lawyer said at the end of the Court of Appeal hearing.
Both sides of the family and Hinduja group have been approached for comment.
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