Follow Us:
Sunday, May 31, 2020

Indiabulls promoters to split biz, reorganise management

Its current net worth is Rs 19,320 crore. IBHFL, the flagship firm, reported profits of Rs 1,569 crore in FY14.

By: ENS Economic Bureau | Mumbai | Published: July 10, 2014 1:39:28 am

The three promoters of the 15-year old Indiabulls Group — Sameer Gehlaut, Rajiv Rattan and Saurabh Mittal — have decided to split the business and reorganise management control of the different group companies among themselves.

Gehlaut will retain control over the flagship housing finance business (Indiabulls Housing Finance Limited), the real estate business (Indiabulls Real Estate Limited), the securities business (Indiabulls Securities Limited) and the wholesale services business (Indiabulls Wholesale Services).

Rattan and Mittal will relinquish all control, management and oversight in these businesses. The reorganisation exercise among the promoters will also allow IBHFL to be completely ring-fenced from the power business.

Rattan and Mittal will control and supervise the power business and Gehlaut will relinquish all control, management and supervisions rights of the power business. The businesses not controlled by Gehlaut — Indiabulls Power Limited (IPL) and Indiabulls Infrastructure and Power Limited (IIPL) — will change their names and delete reference of ‘Indiabulls’ within their names.

“The board of IBHFL wants to delink ownership from management and has decided to elevate the current CEO, Gagan Banga as the vice chairman and managing director of the company,” it said in a statement. “This added responsibility is a step forward toward greater professionalism of the board and indicates the strong intent of the promoters to empower, with accountability, the top echelons of the management team,” it said.

“The balance sheet size of the group is now around Rs 50,000 crore. We are growing at the rate of 26 per cent. In another 3 to 4 years, it will touch Rs 1 lakh crore. The reorganisation is to institutionalise the company. The issue of individual cross holdings will be sorted out. The parting was peaceful,” Banga said.

“Rattan and Mittal have been handling the power business for some years now. There’s no non-compete agreement with Rattan and Mittal. If they want to enter finance business, they are welcome but they can’t use the name ‘Indiabulls’,” he added.

Former RBI deputy governor KC Chakrabarty and former IDBI chairman RM Malla are being inducted into the board of IBHFL. Indiabulls Power is currently developing thermal projects with an aggregate capacity of 5400 MW. The net worth of Indiabulls Power is Rs 5,507 crore.

It was in the middle of 1999, when e-commerce was just starting in India, Gehlaut and his close IIT Delhi friend, Rattan, got together and bought a defunct securities company with a NSE membership and started offering brokerage services. A few months later, their friend Mittal also joined. By December 1999, the company embarked on its journey to build one of the first online platforms in India for offering internet brokerage services. In January 2000, they incorporated Indiabulls Financial Services and made it the flagship company. The Group subsequently diversified into real estate and power sectors.

Its current net worth is Rs 19,320 crore. IBHFL, the flagship firm, reported profits of Rs 1,569 crore in FY14.

📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines

For all the latest Business News, download Indian Express App.