Promoters of ice-cream maker Vadilal Industries settle spat; to rejig firm's management

The warring promoters of listed ice-cream manufacturer Vadilal Industries, the Gandhi family, have reached a pact to settle their disputes in a bid to maximize shareholder value and separate the ownership from the management of the firm, an exchange disclosure said on March 30.

Rajesh R. Gandhi, Janmajay V. Gandhi and Devanshu L. Gandhi, heads of the respective branches of the Gandhi family have entered into a "memorandum of family arrangement," and are desirous of restructuring the management of the company to: (a) maintain equality of interests and participation of all the promoters while maximizing shareholder value, and (b) to establish a more robust framework of corporate governance by appointing independent professional management personnel for management of the business and operations of the company, the disclosure added.

Subject to withdrawal of appeals at the NCLT ( National Company Law Tribunal) and NCLAT ( National Company Law Appellate Tribunal), the ice-cream maker, which has seen its share price rise by 28.18 per cent in the last month, approved the reconstitution of the board with Gandhi family members stepping down from top management posts like CFO and MD and assuming the role of executive directors instead. 4 independent directors have also been named.

"Further, in view of the significance that the brand “Vadilal” holds in the business operations of the company, the promoters are also desirous of housing the ownership of the brand within the company, which is currently used by the company under a non-exclusive license, for a limited period, from a promoter group entity," as per the terms of the settlement.