In the process of division of assets between five family branches, the $4-billion Godrej Group is finding it tough to split its 3,000-acre land parcel in Vikhroli, Mumbai. Sources say that the process of untangling the land parcel started a couple of years back and it may conclude soon. "The business ownership is clear. The family wants to settle the land ownership division amicably," says a legal source.
"A legal dispute on the land parcel, which Godrej family bought in the 1940s, will give opportunity for outsiders to interfere in the matter. The land has been the target of many extortionists with political affiliations in the past and the Godrejs were hell-bent guarding it," says a senior industrialist.
Godrej Group is led by veteran industrialist Adi Godrej (79) as its Chairman. His brother Nadir is Chairman of Godrej Industries and Godrej Agrovet. Their cousin Jamshyd is Chairman of unlisted Godrej & Boyce Manufacturing Company. His sister Smita Crishna and Rishad Godrej — cousin of Adi, Nadir, Jamshyd — also hold a stake in Godrej & Boyce, which owns most of the property in Vikhroli.
A couple of years back, Jamshyd roped in investment banker Nimesh Kampani and lawyer Zia Mody to advise him in separating the land ownership. Kotak Mahindra Bank’s Uday Kotak and Cyril Shroff of legal firm Cyril Amarchand Mangaldas were assisting Adi. They have not yet been able to bring consensus in the matter, say sources.
The 124-year-old group owns 3,400 acres of land in Mumbai — the most expensive real estate market in the country. Of this, the 3,000-acre land in Vikhroli has a development potential of over ₹1 lakh crore. The group can develop 1,000 acres here. About 1,750-acre land is covered with mangroves, and it is the destination of rare plants and birds. About 300 acres of land here has been already encroached upon.
"The family is finding it tough to defend encroachment. At least some of them in the family want to monetise the land before they lose more area," says the lawyer. According to sources, Godrej Properties — run by Pirojsha Godrej, son of Adi Godrej — has majorly benefited from the land parcel so far. They are building The Trees project spread across 9.2 acres of land. Godrej Properties has a market value of ₹62,500 crore.
The Vikhroli property was bought by the then group head Pirojsha, brother of founder Ardeshir Godrej, at a public auction, from the Bombay High Court receiver in 1941-42. It was earlier owned by a Parsi merchant Framjee Banaji — who bought it from East India Company in the 1830s.
Earlier, Godrejs have said in a joint statement that the family has been working on a long-term strategic plan for the group for the last few years to ensure the best value for its shareholders. "As part of this exercise, we have also sought advice from external partners," they have said.