Kirloskar Companies Challenge SEBI

In a bold move, four Kirloskar companies have announced their intention to legally contest a directive from the Securities and Exchange Board of India (SEBI) demanding the disclosure of a family settlement agreement. This agreement, signed by the Kirloskar family members on September 11, 2009, has been a point of contention within the family and now, with the regulatory body.

Background of the Dispute

The dispute traces back to 2016, involving Kirloskar siblings Sanjay, Atul, and Rahul over the division of assets within the Kirloskar group, a conglomerate with a history spanning over 130 years. Sanjay Kirloskar, the CMD of Kirloskar Brothers, stands on one side, while Atul Kirloskar, Executive Chairman of Kirloskar Oil Engines, and Rahul Kirloskar, Executive Chairman of Kirloskar Pneumatic, are on the other.

SEBI's Stand and Companies' Response

SEBI's letter, dated December 30, 2024, urged the companies to disclose the family settlement agreement under the listing obligations and disclosure requirements regulations. However, the companies argue that the agreement does not bind them nor imposes any liabilities, and the matter is already sub-judice since 2018. They criticize SEBI's decision for factual inaccuracies and ignorance of legal principles, asserting their right to challenge the directive legally.

Looking Ahead

As the Kirloskar companies prepare to challenge SEBI's directive, the outcome of this legal battle could set a precedent for how family settlements are treated in the context of corporate governance and regulatory compliance in India. The companies are in the process of filing appropriate legal proceedings to contest SEBI's letter, marking a significant moment in the ongoing saga of the Kirloskar family dispute.