Succession battle in Oswal group

Aruna Oswal, widow of Abhey Oswal, has been appointed chairperson; son Pankaj claims he is the rightful heir

A bitter succession battle seems to have broken out in the Oswal family, following the death of entrepreneur Abhey Oswal, between his widow and eldest son. Oswal's elder son Pankaj is staking his claim to run his business empire, which includes two listed firms Oswal Greentech and Oswal Agro Mills and is estimated to be worth Rs 1,000 crore.

In a statement issued through his public relations firm, Pankaj Oswal said, "My father's untimely death came as a huge shock to me. He was a great businessman and I now want to take his legacy forward and protect the interests and livelihoods of thousands of Oswal employees. As his legal heir I will now start the process to take charge at the Oswal Agro Mill and Oswal Green Tech soon. I want to do my dad proud and take the businesses to new heights." Other family members are minor shareholders in the company and Abhey Oswal died without a will, the statement claimed. Pankaj Oswal claimed him being made to wear the traditional pagdi (turban) of the family as a sign that the Oswal family recognised him as the main heir to head the business empire.

Abhey Oswal died in Moscow on March 29 after suffering a heart attack. Filings by the companies showed that his widow Aruna Oswal took charge as the director of the firms on April 2. Aruna held 1.86 per cent shares in Oswal Agro, while remaining 39.88 per cent was held by the deceased patriarch.

Oswal Agro in turn holds 35.58 per cent in Oswal Greentech. Abhey held 11.11 per cent, while Aruna owned 8.96 per cent in Greentech.

Pankaj owned 5,000 shares in Oswal Greentech and did not have any shares in Oswal Agro.

In addition to these, Oswal Greentech owns 14.2 per cent in listed broadcaster NDTV.

Speaking over telephone from her Aruna Abhey Oswal trust office in Kasturba Gandhi Marg, Aruna Oswal said, "I am his wife and he has nominated me. I am (now) the chairperson of the companies." She directed further queries about the ownership issues to Anil Bhalla, the managing director of Oswal Greentech. Bhalla said Aruna was an educated woman and a renowned social worker. "As the largest (surviving) shareholder of the company, she attended the board meeting held on 2 April. She has given her consent to be on board. Since she gave her consent to be on board, the directors decided to nominate her as the chairperson."

However, the exchange filings did not mention anything about her appointment as chairperson. On the pagdi rasam, a ceremony that follows the death of senior family members and Pankaj's reference to this, Bhalla said, "It is a public limited company. It is not a family business to go by these practices."

Bhalla said Pankaj had fallen out with the family after his businesses in Australia ran into bad weather. "Oswal had thrown him out five or six years ago," Bhalla said citing legal tangles faced by Burrup Fertilsers in Australia.

Pankaj was not available to comment as he was on a long haul flight between Dubai and Australia, his public relations agent said. Pankaj's Singapore-based younger brother Shail Oswal and Shallu Jindal, wife of industrialist Navin Jindal could not be reached for comment. According to an October 2015 story by The Guardian, Pankaj and his wife Radhika Oswal had to abandon their dream home in Perth and allow it to be demolished after serious financial troubles.

Pankaj set up a company called Burrup Fertilisers and built a liquid ammonia plant on the Burrup Peninsula.

The plant opened with much fanfare in 2006. Pankaj had secured a 25-year-long deal for cheap gas and a 20-year deal with Norwegian fertiliser company Yara International to buy and ship the product. "In December 2010, when Burrup Fertilisers was put into administration amid allegations that Pankaj was siphoning millions of dollars out of the company into other privately-held companies. Pankaj has denied any wrongdoing. "Pankaj and Radhika sold their majority stake in the company in 2011 to pay their approximately $900 million debt to ANZ Bank, but are still being chased by a number of creditors, including the shire of Peppermint Grove, which claims it is owed $100,000 in unpaid rates for the oversized block, and the Australian Tax Office, which is chasing a $186m debt allegedly owed by Radhika for a transfer of business interests from Pankaj," the Guardian report of October 2015 said.