Cement biz takeover: Birla family moves court against Lodha
Members of the Birla family on Thursday moved the Calcutta High Court challenging the take-over of the cement business of Anil Ambani Group by Birla Corporation, which is run by Harsh Lodha, claiming that it was being done without the consent of the family or
the court. Stating that the deal was not in the interest of the M P Birla estate, the Birla family members claimed before the bench of Justice Jyotirmoy Bhattacharya that it was being done without the consent of the family and without the consent of the court despite the estate being under the control of special officers appointed by it.
Appearing for the Birlas, counsel P Chidambaram submitted that the cement business was not making profits and would hurt the interests of the estate which is under litigation. A prolonged legal battle ensued in 2004 between the Birla family members and chartered accountant R S Lodha, who had claimed that M P Birla's widow Priyamvada had willed away all the assets of the estate to him.
A probate petition moved by him before the Calcutta High Court was challenged by the Birlas and is still under litigation. Since the demise of R S Lodha, his son Harsh Lodha took over the reins of M P Birla Group. Counsel for Harsh Lodha told the high court today that the funds were not being taken from the estate and that it was being done by group flagship Birla Corporation through internal accrual and other sources.
It was also claimed that the take-over at an approximate cost of Rs 4,800 crore would be a 'sweet deal' as the assets of the cement company were new and modern and would be a good venture. The matter was fixed for further hearing on April 7.