Efforts of Escorts chairman Rajan Nanda to pacify younger brother Anil Nanda may come a cropper. The latter is still contesting the legality of the conversion of Escorts Heart Institute & Research Centre Ltd from a charitable trust to a company.
"My stand has not changed. Smoking the peace pipe will not make the deal legal. The only thing left to do now is to re-convert Escorts Heart Institute & Research Centre to a charitable trust," Anil Nanda said on Monday.
He was reacting to his brother's statement that the proposed divestment in the centre will take place only after the Nanda family dispute has been resolved.
"It is a legal issue, and beyond Anil now," a source close to Anil Nanda said. Rajan Nanda was yet to make an offer or a proposal to his brother, he pointed out.
At the last board meeting of Escorts, Anil Nanda had objected to a proposal to divest 16 per cent stake in Escorts Heart Institute & Research Centre for Rs 65 crore (Rs 650 million) on grounds that its conversion into a company in 1999 was against the law. He had subsequently written to all the Escorts directors on the issue.
The centre was set up in 1984 by the late Har Prasad Nanda, father of Anil and Rajan Nanda.
A few months after his death in 1999, the centre was converted to a company with equity of Rs 2 crore (Rs 20 million), subscribed 80 per cent by Escorts and 10 per cent each by Rajan Nanda and Naresh Trehan. The company's assets are around Rs 110 crore (Rs 1,100 million).
On his part, Rajan Nanda has maintained that the conversion of the trust to a company was essential for its reach. The conversion, he said, was as per law.
