The dispute between French food products major Groupe Danone and industrialist Nusli Wadia over the control of Britannia Industries (BIL), India’s largest food company, is expected to be resolved soon.
In a move that confirms this development, Bombay Burmah Trading Corporation (BBTCL) has informed the Bombay Stock Exchange (BSE) that it will exercise rights of pre-emption at the appropriate time.
“Negotiations with Danone were at a fairly advanced stage and the corporation’s overseas subsidiary which was the existing shareholder in Associated Biscuits International Holdings (ABIH) enjoyed certain rights of pre-emption which it intended to exercise at the appropriate time,” BBTCL quoted Chairman Nusli Wadia informing shareholders.
This information was part of the minutes of BBTC’s annual general meeting (AGM) notice sent to the exchange.
The AGM took place on July 30, 2008. The timing of the minutes, which was sent only on August 29 to the BSE, is important as sources believe that Wadias are close to resolving the stalemate.
A mail sent to Groupe Danone spokesperson in Paris was not immediately responded to. The settlement will pave the way for Groupe Danone to pursue its plan of expanding its presence in India. The French company's plan to expand in the world's second most populous nation has been stymied by the Wadia group due to the ongoing feud, which also resulted in several legal tangles.
Groupe Danone and the Wadia Group hold an equal stake in Associated Biscuits International Holding (ABIH), which in turn holds 51 per cent in Britannia Industries. BBTCL holds shares in ABIH through a complex web of subsidiaries.
ABI Holdings is a 50:50 joint venture of Groupe Danone and Wadia Group.
Wadia group spokesperson did not respond to emails.
