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Introduction:
In 1980s there had been several instances of bitter corporate rifts in India. Early in 1990s two family spats stunned the corporate wold. First was between Raunaq Singh of the Delhi-based Apollo Tyres and his son Onkar singh Kanwar. In terms of sheer unpleasantness, this fight was nothing when compared to the one between Bhai Mohan Singh and Dr. Singh. Every Ranbaxy insiders and those who knew the family well were taken by surprise.
In an article published in the Tribune of Chandigarh in 1984, Bhai mohan Singh was quoted as saying: I feel particularly blessed that I have a brilliant son who has done two years, against the three years taken by others, his Ph.D in pharmacy from a US University. He has been particularly helpful in launching of one unit of our company in Nigeria and another in Malaysia. Though the newspaper called it more an acknowledgement of fact than an expression of parental pride. Everybody knew who was the apple of Bhai Mohan Singhs eye. Being first child of his parents, he was closer to his mother. He gave both his sons the middle name Mohan- Malvinder Mohan Singh and Shivender Mohan Singh
Soon after the three brothers split in 1989. Ranbaxy profitability went up substantially. While turnover more than doubled from Rs. 199.11 cr. In 1989-90 to Rs. 460.67 cr. In 1992-93. The profit after tax shot up from Rs. 8.09 cr. to Rs. 35.34 cr. The companys net worth too increased from Rs. 40.64 cr. In 1989-90 to Rs. 124.56 cr. In 1992-93. At the same time, Manjits Montari Industries was turning into financial mess. Analjits Max India, though profitable, was still small. It had received a blow when Ranbaxy decided to make its won 7ADCA in the early 1990s. Analjits other venture into BOPP films was close to shutting down.
Ranbaxy was now being completely run by professionals. The only members of the family in the new-look executive committee were Bhai Mohan Singh and Dr. Singh. Brar had been promoted as president (pharmaceuticals) in 1991. the second most important position in the company. Dr. Singh trusted his genius totally and would consult him while taking all decisions.
Division:
Bhai Mohan Singh has transferred all his Ranbaxy shares to Dr. Singh. There was an agreement in the family settlement that Bhai Mohan Singh would be involved in important matters. Company would take care of his expenses on things like housing, medical treatment and travel. Dr. Singhs deep attachment and respect for his father gave no reason to believe that transfer of shares could one day lead result in he being stripped of all powers. Ranbaxy was more than just an enterprise for Bhai Mohan Singh. He mostly referred to his close friends as a fourth son.
The fact that his wings had been clipped soon started preying Bhai Mohan Singhs mind. He blamed Dr. Singh for it. From being inseparable, they now got into a bitter struggle. Once news broke out Bhai mohan singh was not averse to washing dirty linen in public. He started telling his friends that Dr. Singh was violating the family agreement. He also complained that Dr. Singh was showing no signs of fulfilling his promise of setting up a trust to carry out charitable activities. The valuation of the family assets was done by Bansi Mehta, the renowned Mumbai based chartered accountant.
The Change
Dr. Singh knew that there will be a change in pharmaceutical business. The days of unprotected patents was numbered. Bimal Raizada, his close associate, was the fist who came to know abhot the changing views of Dr. Singh. Dr. Singh ordered that Ranbaxy will stop funding National Council for Patent Laws. Cipla continued to fund NCPL, arguing against Indias commitment to reintroduce product patents from Jan 1st, 2005.
The support of Dr Singh was withdrawn. The top professionals gave him undated resignation letters. Though, father and son were fighting in the boardroom, it did not affect the day to day functioning of the company. But if these professionals resigns, then Ranbaxy could come to a halt. In companys board meeting, around 50 executives entered boardroom shouting slogans for Dr. Singh. This was led by Sanjiv Kaul, who joined ranbacy in 1983.
The fight started to turn in favour of Dr. Singh when Prof. Veda Vyas, Rustom P. Soonawala, Narottam Sahga; and D.D. Chopra resigned from companys BOD, on 18th Sept 1992. Dr. Singh appointed, Tirath R. Mulchandani, Vivek Bharat Ram of Eicher group and journalist Suman Dubey. Vivek Bharat Ram and Dr Singh had grown very close. Brar and Sheth were appointed as alternate directors b/w Sept and Nov 1992. Dubey resigned as he became in-charge f Dow Jones, a financial news agency. Dr Singh rarely uttered a word against his father but his friends targeted Bhai Mohan Singhs friends on board. Avtar Kaur served ranbaxy board till 1983. When Bhai Mohan Sighs and his sons fight erupted, 3 members apart form Manjit, decided to support Bhai Mohan Singh: Dan Singh Bawa, Air Marshal OP Mehra, and MM Sabharwal.
Bitterness
By now, father and son were not taking terms. Dr Singh used to visit his mother daily, but father refused to see him. Avtar Kaur was torn between her husband and favourite son. After this, her heath started failing. She died in July 2004, after prolonged illness. Several friends of both father, and son, tried to resolve the crisis but in vain. Sabharwal and Avtar Kaur went several times to counsel Dr Singh when father and son were not talking terms. But he refused to relent. Realtions went too sour that father wrote a letter to son saying that there was no need to attend his funeral. No one was able to patch things between them. It is not easy to get Punjabis to compromise
Prem Pandhi, an old friend of Bhai Mohan Singh and executive chairman of Cadbury India, told Bhai Mohan Singh to let things go but he would not listen as he was boiling from inside. Pandhi even tried to reason with Dr Singh by telling him that all his father needs is a little attention. But for Dr Singh, he had to win the battle against his father as if he lost, then the ambitious plans he had drawn for Ranbaxys Success would all be scrapped.
A few decisions
Once Dr Singh died, Bhai Mohan Singh made one last attempt to regain control of Ranbaxy. He did not make nay formal demand, but he told media that the promoter family should be represented on Ranbaxy board and therefore, Malvinder and Shivinder, should be inducted on the board right away. But Dr Singh had made very clear that his sons would join the board only on the basis of merit.