The Rs 13,000 Cr Bhushan family dispute

Source :IE Agencies:New Delhi:: Tue Nov 15 2011, 22:37 hrs

The Rs 13,000-crore Bhushan group today announced settlement of a nine-year old family dispute, following which Bhushan Steel will be owned and controlled by Brij Bhushan Singhal and his younger son Neeraj.

Singhal's elder son Sanjay would get the control and ownership of Bhushan Power and Steel (BPSL), a joint family statement said.

"The family is pleased to inform that an amicable settlement and understanding in respect of ownership and control of all companies under the Bhushan Group," it said.

The brothers will accordingly and mutually transfer their stakes to each other in the two companies. Sanjay holds 11 per cent stake in Bhushan Steel, while the younger sibling, Neeraj, has a 3 per cent stake in Bhushan Power and Steel.

The statement added that the father will continue to hold one-third of the promoter's stake in Bhushan Power and Steel (BPSL), amounting to 19 per cent shares of BPSL.

The personal assets have been broadly divided in line with the understanding of November, 2002, the statement said, adding that Sanjay will not have any claim on his father's 19 per cent stake in BPSL.

The family has also decided to withdraw all the cases pending in courts, the statement further said.

Due to disputes over management and control of the group companies, the Singhal's had reached a family settlement in 2002. According to this, Senior Singhal was to remain chairman of the two group companies, while Neeraj was to run Bhushan Steel (BSL) and Sanjay was to control Bhushan Power and Steel (BPSL).

However, the family settlement could not be implemented and the matter had landed in the Company Law Board in 2006 and later in the Delhi High Court.

Bhushan Steel, with a 2.5 million tonnes per annum (MTPA) capacity, had reported a turnover of over Rs 7,000 crore in 2010-11. On the other hand, Bhushan Power and Steel, with a turnover of over Rs 5,000 crore, has a production capacity of 2.3 MTPA.