Kesoram Industries, a BK Birla Group company, will not be split. It will be run jointly by Kumar Mangalam Birla and Manjushree Khaitan after BK Birla steps down as chairman.
Changing his earlier succession plan, BK Birla made it clear on Thursday that after him, his grandson Kumar Mangalam Birla and his daughter Manjushree Khaitan would run the company jointly.
“After me, Kumar and Manjushree will take charge of the company, but there is no question of splitting Kesoram. The company will remain one. Shareholders’ interest will have to be protected. Kumar and Manjushree jointly will run the company. One may be the chairman and another may be the vice-chairman. Kumar may look after some units and Manjushree some others. The future of the company will be decided by them,” BK Birla told reporters after attending the 89th annual general meeting of Kesoram Industries.
Under the earlier succession plan, Kesoram Industries, which has interests in tyres, cement, spun pipe and rayon, was supposed to go to Kumar Mangalam Birla.
“I have spoken to Kumar and he says that he does want it now. He is already in the board of Century Textiles. He is so busy these days and if he becomes chairman, he will need to come to Kolkata at least once every three months. Kumar wants me to continue as chairman till I become very old. However, its up to him and Manjushree to decide when they want to take charge,” said BK Birla.
Manjushree has been already inducted in the board of Kesoram Industries. When asked why Kumar Mangalam Birla was not inducted on the board of Kesoram Industries, Birla said it was just a matter of time.
Kesoram Industries spent Rs 700 crore in 2007-08 for augmenting its capacity of tyres and cement. The company has decided to invest Rs 1,450 crore during the current and next financial years for setting up three tyre manufacturing plant in Uttaranchal and one cement plant in Karnataka.
During 2007-08 the net sales of the company stood at Rs 2,987 crore. Kesoram Industries earned a net profit of Rs 383.35 crore in 2007-08.
To a query, BK Birla said although the rayon division was making losses, there was no plan to hive off the division. The spun pipe division was making marginal profits, said BK Birla.