CONTINUING CRISIS

BUYING INTO DISPUTE

SOON AFTER TATA STEEL announced its plan to acquire the one million tonne steel business of Kolkata based Usha Martin for up to ` 4,700 crore, the founder of the wire and specialty steel maker, Basant Jhawar and his son Prashant issued a statement seeking clarity on the end- use of sale proceeds. The father- son duo have about 26 per cent stake in the company, while Prashant’s cousin Rajiv Jhawar’s family holds another 26 per cent.

Prashant and Rajiv are at loggerheads over the control and ownership of the business, in which Rajiv is the managing director. In April 2017, the lenders removed Prashant from the role of chairman for alleged mismanagement of the company. Now the question before the father and the son is what their share of income from the sale of assets would be. They fear that Rajiv would protect only his interests. Tata Steel will have a tough time negotiating with warring promoter families. –