Bengaluru, NFAPost: The Murugappa family on Sunday announced an amicable settlement of all outstanding legal disputes and differences with Valli Arunachalam, heir of the MV Murugappan family branch.
The resolution was reached through a family arrangement while the Murugappa family announced that the terms of the family arrangement will remain confidential, and none of the listed companies under the Murugappa Group are parties to these terms.
The members have agreed to settle the disputes and differences between the family branch of late M V Murugappan (including Valli Arunachalam and Vellachi Murugappan- Valli’s sister), on one side, and the rest of the family members, on the other side, which arose post the demise of M V Murugappan, the Murugappa Group’s former executive chairman.
As part of the family arrangement, the parties have also agreed that all legal proceedings between the family groups will be withdrawn as per the terms of the family arrangement after all agreed steps specified in the family settlement have been completed, according to a statement issued by the Murugappa family.
Differences cropped up between the family branch of M V Murugappan and the rest of the family members when Valli Arunachalam, daughter of Murugappan, sought a representation on Ambadi Investments Ltd (AIL), the holding company of the Rs 74,220 crore Murugappa group, post the demise of her father.
This demand was denied as the board has traditionally been occupied by male members of the family. Her request for a fair market acquisition of her shares in the family’s businesses was also denied. Following that, Valli Arunachalam initiated legal proceedings against the Murugappa family in early 2021 and has been fighting the cases in NCLT and NCLAT since then.
“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. The terms of the family arrangement itself are confidential,” said representatives for the family members.
The family said that no listed company forming part of the Murugappa Group is a party to the family arrangement, and nothing in the family arrangement relates to the management or control of, or grants any special rights to the parties in, any such companies.
In a bid to broker the truce, the members of the Murugappa family first discussed and concluded the terms of the family arrangement amongst themselves at a meeting in the presence of their respective advisors. This understanding was recorded on Sunday by way of a memorandum entered into by the members of the Murugappa family with the family branch of M V Murugappan. The family members are committed to undertake the necessary transactions to effect the family arrangement within the next 90 days.
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.
Valli Arunachalam hit the headline in 2020 when she openly came out against Murugappa group for denying her a seat on the board of AIL, despite having a stake of 8.21%. She even alleged gender bias in not appointing her. The AIL board then decided to take up her resolution for the board seat on September, 2020, AIL shareholders, comprising largely family members, voted against the resolution to appoint her a non-executive director of the company with 91.36% of votes cast against her appointment. Angry with the rejection she took legal recourse and sent a legal notice to the Murugappa group and the family members.
