Interestingly, the 'family agreement', which was made public on Monday by the markets regulator Sebi, also provides that Kamil Hamied, son of Mustafa Hamied, would be deemed as representative of the existing main promoter Yusuf Hamied in the current scenario if neither of the two brothers is able to attend a shareholder meeting for any reason. There have been speculations in the past that Y K Hamied, who hanged his boots as Managing Director in March 2013, is grooming his nephew Kamil as the next leader at the home-grown pharmaceutical giant.
The 'agreement' has been made public by Sebi in relation to an 'interpretative letter' requested by Y K Hamied about whether the "voluntary and consensual family understanding" involving the arrangement of voting rights would trigger an open offer for the minority shareholders of the company.
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Sebi has opined that the proposed arrangement would qualify for exemptions from open offer.
Hamied further told Sebi that historically no proxies were executed among individual family members, except that Sophie Ahmed (his sister) whould execute a proxy in his favour.
"Sophie Ahmed has reserved her right to be party to the Agreement and should she chose to act according to the Agreement she would be made a party or deemed to be party to the Agreement," he wrote in his request letter to Sebi.
He further said that the Agreement was proposed as part of a "voluntary and consensual family understanding, and with the intent of putting into writing the broad understanding in respect of the manner in which the Group will exercise votes in respect of the Company".
The Agreement also provides for a "preemptive right in case the shareholders choose to transfer their shares", he added.
Y K Hamied, 78, who took over the reins of the company after death of his father Khwaja Abdul Hamied in 1972 and remained at its helms for 40 years, is known as one of the biggest forces behind making Cipla one of the best family-run companies in the country. It commands a market value of over Rs 53,000 crore and has turnover of over Rs 10,000 crore.
All promoters put together hold 36.8 per cent stake in Cipla, while Y K Hamied individually owns 15.55 per cent. His sister Sophie holds over 5 per cent stake.
Interestingly, Sebi was also requested for another 'guidance letter' with regard to transfer of certain shares by way of 'gift' to Y K Hamied from his wife Farida. To this also, Sebi opined the arrangement is exempt from open offer. Farida also has over 5 per cent stake.
The 'informal guidance' on both the issues was sought by Y K Hamied in October 2014, while Sebi gave its reply to him on proposed share transfer from Farida on January 29, 2015. The reply on the second issue was given on February 2, 2015.
However, Hamied had requested for "confidentiality" in respect of Sebi's interpretative letters on both the issues. As per Sebi rules, the matters were therefore kept confidential for 90-day periods. While one letter was made public earlier, the second one was published today.