'Rajeev sold 57% in BPL Comm'

Transaction not disclosed: TPG Nambiar.

The BPL family feud took a new turn today, with group patriarch TPG Nambiar alleging that his son-in-law Rajeev Chandreshekhar had in recent months sold 57 per cent stake in BPL Communications to Coimbatore Cablenet Private Ltd and Tayana Consultants Private Ltd.

As both Coimbatore Cablenet and Tayana Consultants are not respondents in the family dispute before the Company Law Board (CLB), these companies are not required to intimate the board if they want to sell their stake.

"Both are front companies of Chandrashekhar. In fact, Coimbatore Cablenet and BPL Mobile Cellular have the same registered office," sources close to Nambiar said.

When contacted, sources in the Chandrashekhar camp said: "Both Coimbatore Cablenet and Tayana Consultants are independent investment companies and Chandrashekhar has their mandate and support in managing them. Any combination of persons can have majority stake. BPL Communications is a professionally run company and it does not matter who is the owner."

The Chandrashekhar camp has also submitted to the CLB that the shares were allotted through a rights issue in 2004, and not recently as alleged by the Nambiars.

The Nambiars have alleged that as per the shareholding submitted by Chandrashekhar, their (Nambiar's) holdings have been reduced from 30.19 per cent to 7.24 per cent, while the stake owned by foreign institutional investors has come down from 37.39 per cent to 20.43 per cent.

The Nambiar group is fighting to regain control of the group's mobile business as it alleges that its stake in the company has been illegally diluted through rights issues and changes in shareholding.

BPL Communications is the holding company for BPL Mobile Communications and BPL Mobile Cellular.

Emphasising that their stake has been continuously diluted, the source in the Nambiar camp said: "They never disputed the shareholding filed by the Nambiar group in the original petition before the principal Bench of the CLB in Delhi according to which the petitioner group in total held 30.18 per cent (including 13.26 per cent held by Electro Investments)."

On its part, the Chandrashekhar camp said there was no merit in the argument that TPG Nambiar has the first right of refusal in case FIIs wanted to exit BPL Communication.

"In 2002, the shareholder agreement was cancelled by both the parties. So where is the question of any right? Further, about $20 million would be needed to buy out the FIIs. Do they have the money?"