Gharda Chem to divest 60% stake

MUMBAI: Keki Gharda, the grand old man of Indian agrochemical industry, is giving finishing touches to his succession plans that could soon change the way the closely-held Gharda Chemicals — once reported to have been a takeover target for the Tatas — operates.
Mr Gharda, the scientist-founder of Gharda Chemicals, is building a new organisational set-up that would include a soon-to-be-formed board of directors and trustees. The 78-year old founder-chairman is also exploring options to sell the 60% stake owned by him and his wife in the Rs 700-crore company. “I will sell...not just for the highest price but to someone whom I trust,” says Mr Gharda.

Among those interested include the Tatas. “We had, what you can call, an initial flirtation,” he says of his meeting with the Tatas, adding, “But they didn’t make an offer.” He refused to confirm if there are other suitors. About 33% of the company is owned by Mr Gharda’s relatives while the rest is owned by over 2,000 employees. Referring to his future plan, Mr Gharda says, “I don’t have successors.

And the baby (the company) has grown up...I have to let it go.” The post of CEO too has been formed. “The person will join in July. I will remain the CMD...may be till the end of the year. And then continue as executive chairman, and later as non-executive chairman,” he adds. Gharda Chemicals, which initially started operations in a 2,000 sqft shed in Vakola, Mumbai, will soon have a full-fledged board.

“There will be two or three more professionals, including a lawyer and a chartered accountant to form the board. As of now the board is me, myself and my wife,” Mr Gharda says. A board of trustees will also be formed to take care of the 60% stake and so will be “a board of auditors to supervise the directors and trustees.” Any plans to go public? “I like to gamble with my own money, not with others,” says he. The gamble includes his iron and aluminium project and a Rs 14-crore engineering college on the outskirts of Mumbai. “It will have no capitation fee,” he adds.

Mr Gharda was the first Asian to win the Chemical Pioneer Award from the American Institute of Chemists. Since 1965 when Gharda Chemicals was founded, the company has successfully competed with multinational giants by making products cheaper and many times better. Interestingly, the scholarships provided to Mr Gharda during his students days in the US were sponsored by these very companies. “They fed a viper!” Mr Gharda joked in a recent interview.

Today, half of Gharda Chemicals’ revenues come from exports. Succession plans apart, the veteran chemical engineer is in no mood to rest on his laurels. Mr Gharda plans to spend his time in the labs, researching in projects which, he claims, will save the global steel and aluminium industries $68 billion annually. The metallurgy project, which he accepts is “unusual for a chemical engineer,” is about making the manufacturing of steel, aluminium and titanium, efficient by almost 30%. “The changes I want to bring seem obvious. But no one has done it till now. Almost Rs 15 crore has been invested. We expect to get concept patent for the aluminium project soon. The reliability tests will begin by the year-end,” he adds.prince.thomas@timesgroup.com