Britannia khao, bahar jao

By sacking Sunil Alagh
07 June 2003

Mumbai: It is increasingly becoming apparent that Nusli Wadia, the feisty chairman of the Bombay Dyeing group, loves a fiery fight.

When he was in his thirties he wrested control of the Bombay Dyeing group by easing the earlier generation of the Wadias. During the 1980s he partnered with Indian Express group chairman Ramnath Goenka to fight in public a long drawn-out and nasty brawl with the Ambanis. The brawl petered out after Goenka's death and with the Ambanis moving on to other areas of activity, although there are a few skirmishes now and then even now.

Then came the famous episode of the ouster of the late Rajan Pillai from the board of Britannia Industries, which is controlled by the Wadias and the French group Danone. In this battle, he was ably assisted by the high-profile and flamboyant Sunil Alagh, who later became the managing director of Britannia Industries.

Now Alagh, an IIM-Calcutta alumni who joined Britannia Industries after graduation and was with the company for 30 long years and was the managing director for the last 10 years, has been sacked. For Nusli Wadia, this latest victory looks like a knockout punch.

Last Tuesday (2 June 2003) the board of Britannia met (Alagh did not attend), and after marathon deliberations which went on into the night the board passed a resolution to "terminate the services of Sunil Alagh with immediate effect." No reasons for the termination were given.

This historic corporate decision can draw parallels with Tisco's decision about 10 years ago when the Tisco board terminated the services of its then chairman, Russi Modi. At that time it was debated whether the board had the powers of such termination. However, the Tisco board considered that it has the powers, and the decision was not legally challenged. The Tisco board did, nevertheless, give the reasons for the termination, which was that Modi's public utterances against the board was against the interest of the company.