Priya Sachdev Kapur has moved to oust her estranged mother-in-law, Rani Kapur, from a trust set up by the late Sunjay Kapur that controls the promoter entity of listed Sona BLW Precision Forgings Ltd, escalating a battle for ownership of the auto components firm, valued at over $3 billion.
In a notice issued to Rani Kapur on 24 March, Priya Kapur said that the actions of her mother-in-law have been adverse to the interests of the RK Family Trust due to which she is being removed from the trust.
This comes after Rani Kapur issued a notice to remove Priya as one of the trustees on 21 March, about two months after filing a civil suit in Delhi High Court asking for the court to void the trust.
“Trust law does not permit a trustee to simultaneously challenge the existence of a trust while exercising powers under it,” a press statement issued on behalf of said.
Queries emailed to Rani Kapur’s lawyer did not elicit a response immediately.
The developments mark the latest escalation in the dispute between Priya Kapur and her estranged mother-in-law, Rani Kapur, over ownership of the trust that controls the promoter entity of Sona BLW Precision Forgings Ltd.
RK Family Trust holds a 65% stake in Aureus Investment Private Ltd, which in turn owns 28% in . Aureus is represented by Priya Kapur on the board of the company as a non-executive director.
“The removed trustee can file an application for stay. A lot depends on the terms and enforceability of the trust deed,” Akshat Pande, managing partner, Alpha Partners, said.
The family trust counts four beneficial owners: Priya, her son Azarias, and two children of Sunjay’s with Karisma Kapoor, Samaira and Kiaan. Rani Kapur was one of the trustees in the family trust.
Before Sunjay’s death in June last year in London, he was the sole beneficial owner of the trust that was originally named after Rani Kapur. In 2017, Rani Kapur transferred her entire shareholding in Aureus, which she got after the demise of her husband, to this trust, which in 2019 made her son Sunjay Kapur its sole beneficial owner.
After his demise, the beneficial ownership transferred to the four trustees mentioned above. In a petition filed before the Delhi High Court, challenged Priya Kapur’s control of the promoter entity, claiming that her shareholding was fraudulently transferred to the trust in 2017.
“By challenging the very validity of the Trust and seeking to divest the Trust of all its assets, you have disregarded the Trust completely and have set up an interest in the Trust assets wholly inconsistent with the interests of the beneficiaries as well as the Trust Deed, thereby rendering you Incapacitated to continue functioning as a Trustee of the Trust,” Priya’s notice to Rani Kapur said.
The dispute between Rani Kapur and Priya Sachdev Kapur began in July, when Rani Kapur wrote to the company’s board a day before the annual general meeting of Precision Forgings, at which shareholders were set to vote on Priya’s position on the board.
In the letter, Rani Kapur opposed the appointment of Priya on the board of directors of Sona Comstar and asked the company to defer the proceedings. She alleged that she was coerced into signing some documents and was not aware of the full details of the proceedings.