Maker of Marlboro and Four Square cigarettes Godfrey Phillips and other businesses built by industrialist KK Modi who passed away last November are being put up for sale. This has been confirmed by his son Lalit Modi via a series of tweets. The significant ones on the chopping block are Godfrey Phillips, Modicare, Modicare Healthcare Placement and 24Seven convenience stores.
The companies have been put on the block by key promoter entities, led by the KK Modi Family Trust. The trust is led by the KK Modi group.
Confirming the development, Lalit Modi, in a series of tweets said that all asses of the KK Modi group are going on sale. “Yes all Assets of the K K Modi group are going on sale. I mean all. The other 3 trustees wanted to continue running the Business but I felt post my father passing away - the value will deplete. I voted for sale,” he said in a tweet.
Just to set the record straight. Yes all Assets of the #kkmodi group are going on sale. I mean all. The other 3 trustees wanted to continue running the Buisness But I felt post my father passing away - the value will deplete. I voted for sale. https://t.co/dJOIYsevJR. Sale On pic.twitter.com/lKOKZXP04z
— Lalit Kumar Modi (@LalitKModi) January 27, 2020
He also said that he did not approve of Bina Modi to run the empire saying that she isnt ‘qualified to run such a large corporation and will dilute the value’, indicating that there could be different in the family.
I did not approve #Binamodi to run the #empire as she is not qualified to run such large corporation and will dilute our value. Thus the sale of all companies, properties etc,has been approved at the first trust meeting on 30/11/2019. the full sale must be completed by 29/11/2020 pic.twitter.com/SqWoTkUF3V
— Lalit Kumar Modi (@LalitKModi) January 27, 2020
Colorbar, Ego Italian, Beacon Travels and the education businesses, all part of the group will be retained and run by the family members, Bina Modi, her son Samir and daughter Charu. Lalit Modi, who lives in London may not be part of any day to day management of the companies it appears.
Godfrey Phillips currently makes the Marlboro brand cigarettes, with Philip Morris holding 25.1% stake in the company and 47.09% with the KK Modi Group.
The family shareholding of the KK Modi group has been transferred to the trust to ensure no one of the beneficiaries own shares. Bina Modi, Charu Modi and Sameer Modi are also trustees of the group, apart from Lalit Modi.
The trust that runs these enterprises has appointed an investment banker to scout for suitable buyers for the companies by November 29, 2020.
After KK Modi passed away in November 2019, Bina Modi was named chairperson of Modi Enterprises. However, there have been reports of dispute over the assets among family members.
Lalit said that the full sale must be completed by November 29, 2020.
“The investment banker will have mandate to sell to highest bidder. The banker will be assisted by group CEO RK Malhotra,” Lalit Modi reportedly said.
According to a Hindu Business Line report, the trust is in talks with global investment bankers, including Goldman Sachs, Morgan Stanley, JP Morgan and Credit Suisse, for the mandate to sell their stake.