Fortis row: Shivinder files case against elder brother
After months of simmering discontent, the feud between the Singh brothers of the erstwhile Ranbaxy group spilled out into the open with younger sibling Shivinder filing a case of “oppression” against his brother Malvinder and family friend Sunil Godhwani for systematically undermining the interests of Fortis Healthcare Ltd and related firms.
“I have filed a case against Malvinder and Sunil Godhwani in the NCLT for oppression and mismanagement of RHC Holding, Religare and Fortis,” Shivinder said in a three-page document.
“The collective, ongoing, actions of Malvinder and Sunil Godhwani led to a systematic undermining of the interests of the companies and their shareholders... as also the committed and loyal employees of the group...,” he added.
“I mutely watched the organisation I founded come to a point where it was publicly auctioned; where my family and myself have been stripped of our legacy, our finances and my personal credibility.” Malvinder Singh declined to immediately comment on the development. Godhwani did not respond to a text message sent late Tuesday.
Mint on July 2 reported on the serious differences emerging between the brothers, the two former promoters of Fortis Healthcare, with Shivinder distancing himself from the alleged irregularities and decisions taken in the past two years at the hospital chain.
Heirs to a generations-old business house, once worth billions, the brothers have in the last six months seen a dramatic fall in their fortunes with much of their public shareholdings seized by lenders. The irregu- larities in Fortis are being probed by financial authorities, including the Serious Fraud Investigations Office (SFIO,). The Singh brothers owe $500 million to Daiichi Sankyo over fraud allegations related to the 2008 sale of drugmaker Ranbaxy Laboratories. The role of the two brothers is also being probed as part of the ongoing investigations.
Fortis Healthcare has said it will appoint an external agency to undertake scrutiny of its internal controls and compliances after an investigation found systemic lapses in funds allegedly taken out of it by erstwhile promoters Singh brothers.
Shivinder claimed that he had retired and had left for Radha Soami Satsang Beas, a spiritual organization, in December 2015, leaving Fortis in supreme financial health and hence he has no hand in any wrongdoing.
He questioned decisions taken in Religare’s NBFC arm (which was headed by Godhwani); the transaction and subsequent management of the sale of the group’s then flagship —Ranbaxy to Daiichi, which he called “the most damaging arbitration case in the history of India Inc.”; the unimaginable losses accumulated in running a private charter airline business (Ligare aviation).
“All these only go to show that the malaise is systemic,” he said, adding the damage caused was irreparable.
“Despite my best efforts, on my return from Beas for the past many months to salvage the situation, the continued systemic missteps resulted in a quicksand which now seems beyond resolution, if I continue to remain silent,” he said.
In his release, Shivinder has also sought to disassociate himself from his brother claiming that for two decades, he and his brother have been synonymous with one another and he has “all along been the publicly supportive younger brother to Malvinder’s chairmanship of the group, who took decisions on behalf of the family”.
“While it saddens me immensely and I wish Malvinder well; I can no longer be party to activities in which transparency and ethics are continuously and consistently negated. It has come to a point where this means that I am now disassociating from my brother as a business partner and will be pursuing an independent path going forward,” he said in the letter.