Raymond MD against plan to sell JK House

MUMBAI: In the ongoing controversy over Raymond Ltd’s proposed sale of JK House to members of the promoter Singhania family, chairman and managing director Gautam Singhania has urged shareholders to vote against the sale.

In an email statement to the media, Singhania said he personally did not approve of the transaction but will abstain from voting on it during the company’s upcoming annual general meeting as he is an interested party.

“The tripartite agreement entered in year 2007 between the company, lessor and occupants, all of whom were related parties, to offer apartments for sale at a substantial discount to the current prevailing market prices which would cause a major loss to the company and shareholders,” Singhania said in the statement. “Keeping this in mind, the company decided not to act on this agreement.”

This 2007 agreement was signed between Raymond that owns JK House, its subsidiary Pashmina Holdings Ltd that leased JK House from Raymond, and four members of Gautam Singhania’s immediate family, including his father Vijaypat Singhania and cousin Akshaypat Singhania. Pashmina sub-let the four duplex flats to these four family members from 1994 onwards at a rent of ₹7,500 per month per flat. The 2007 agreement said that once renovations of JK House were complete (at Raymond’s expense), the four flats will be sold to their tenants at ₹9,200 per sq. ft of carpet area.

“Needless to say, as a related party I am required to abstain from voting on this resolution,” Singhania said in the statement. “However, my personal opinion would be to vote against the resolution in interest of the shareholders and company.”

Last year, three of the four tenants of JK House—Vijaypat Singhania, Akshaypat Singhania and Veenadevi Singhania— wrote to Raymond “exercising their option to purchase the new apartments”. Akshaypat, Veenadevi and Anant Singhania have now filed two arbitration petitions before the Bombay high court in a rapidly escalating Singhania family feud.