Diversified business conglomerate RPG Enterprises is realigning shareholding patterns across group companies overseen by 80-year old patriarch Ram Prasad Goenka as the process of passing control to the next generation in one of India's oldest business houses enters the final lap.
Goenka, the group's chairman emeritus, told PTI in Kolkata that the process of segregating the group's control between his two sons — Harsh and Sanjiv — will be completed "during this year, by December."
The process involves segregation of ownership of 16 companies with combined turnover of R16,000 crore managing diverse business interests in the areas of power, tyre, infrastructure, information technology, retail and entertainment headquartered across Mumbai and Kolkata.
Ten of these companies are listed on bourses that command a combined market capitalisation of R9,932 crore.
The two brothers have been managing the company since early 1990s.
The succession process in the three-decade-old group, which has a business legacy of nearly two centuries, will perhaps mark one of the smoothest ownership and control transfers in India's corporate history, analysts tracking the group said.
"It is a forward looking and a futuristic move that will ensure that there is no conflict going forward based on shareholding and it ensures that whoever is managing a company has the ownership of the same," said a source who did not wish to be named.
This action should not be looked upon as a result of any conflict within the group.
"The two brothers are constantly in touch with each other and there has always been a clarity within the group on the fact that the person who manages the company represents it other than when it comes to representing the group," said the source.
Under the succession plan Harsh Goenka (52) will continue as the chairman of the group and Sanjiv Goenka (49) as the vice-chairman of the group. Harsh Goenka manages flagship companies such as KEC International and Ceat that belong to the group.
Sanjiv Goenka manages the CESC and the retail arm Spencer's Retail along with other companies.
KEC International with operations in engineering and construction clocked the maximum revenue for the group, but power generation and distribution company—CESC—returned with highest profits among all RPG Enterprise group companies.