Vadilal Industries Limited is undergoing a significant transformation following a family agreement among its promoters, which will lead to a major restructuring of the company’s management and board. The longstanding dispute over control of the family business has been between three key figures: Virendra Ramchandra Gandhi (VRG), Rajesh Ramchandra Gandhi (RRG), and Devanshu Laxmanbhai Gandhi (DLG).
On March 29, 2025, Vadilal Industries received a letter from its key promoters—Rajesh R. Gandhi, Janmajay V. Gandhi, and Devanshu L. Gandhi—outlining the terms of a memorandum of family arrangement. The company clarified that while it acknowledged the agreement, it was not a direct party to it.
The company informed the regulators that, “The fourth generation of the Gandhi family have, in the past, harboured diverse interests, different ambitions and varying perceptions as to, inter alia, the strategic direction, growth and governance of the Vadilal group. While the family is still united under the respective family branches, due to uneven growth, differing perceptions, expectations and including matters related to the strategic direction, growth and governance of the Vadilal group, various disputes and differences have arisen amongst the Gandhi Family Members, inter alia in relation to the affairs of various group entities including the company.”
“The Gandhi Family Members are now desirous of settling their inter-se disputes by restructuring the management of the Company to maintain equality of interests and separating the ownership from the management of the Company to maximize shareholder value and achieve greater heights.”
The Gandhi family members have entered into this agreement to settle internal disputes and restructure the company’s management. The primary objectives of this restructuring are to maintain equality of interests among promoters, maximize shareholder value, and establish a more robust corporate governance framework by appointing independent professional management.
A key component of the agreement involves securing the “Vadilal” brand within the company. Currently, the brand is used under a non-exclusive license from a promoter group entity. To achieve this, certain promoter-owned companies will be merged into Vadilal Industries, thereby transferring brand ownership to the company.
In line with the family agreement, the Vadilal Industries board of directors met on March 29, 2025, and approved several key actions, subject to shareholder and regulatory approvals:
Amendment of Articles of Association: The board approved amending the company’s articles of association to incorporate the terms of the family agreement. This is contingent upon the disposal or withdrawal of certain appeals and petitions before the National Company Law Appellate Tribunal (NCLAT) and the National Company Law Tribunal (NCLT).
The board approved a composite scheme of amalgamation to merge promoter/promoter group entities with Vadilal Industries. This includes the merger of Vadilal Finance Company Private Limited (VFCPL), Veronica Constructions Private Limited (VCPL) and Vadilal International Private Limited (VIPL).
This merger is subject to approvals from shareholders, creditors, and regulatory bodies, including stock exchanges, SEBI, and the NCLT.
Further the board approved restructuring subject to shareholder approval and the resolution of ongoing litigation, the board approved resignations of Kalpit R. Gandhi as Chief Financial Officer and non-executive non-independent director, Rajesh R. Gandhi and Devanshu L. Gandhi from their positions as Managing Directors, Deval D. Gandhi as a non-executive non-independent director.
Change in terms of appointment of Rajesh R. Gandhi and Devanshu L. Gandhi as executive directors and appointments of Janmajay V. Gandhi as an executive director, Gaurav Marathe as a non-executive non-independent director, Shalini Raghavan, Mr. Shivakumar Dega, and Mr. Nagarajan Sivaramakrishnan as independent directors and Rajesh Pandya as an additional non-executive non-independent director, effective from March 29, 2025, until the resolution of litigation.
The restructuring follows a series of legal battles within the Gandhi family. On July 10, 2024, the NCLT partially upheld a petition filed by Virendra R. Gandhi against Vadilal Industries, Rajesh R. Gandhi, Devanshu Gandhi, and others, citing allegations of oppression and mismanagement under Sections 241 and 242 of the Companies Act, 2013.
As part of its ruling, the NCLT declared a board resolution that had authorized Virendra R. Gandhi’s retirement from Vadilal Industries and Vadilal Enterprises Limited as “null and void.” The tribunal also ordered the division of Vadilal’s family businesses among the three factions—VRG, RRG, and DLG—under the supervision of a court-appointed commissioner.
This decision was subsequently challenged before the NCLAT. In September 2024, the appellate tribunal issued a ruling on a petition filed by Rajesh R. Gandhi, who sought to maintain the status quo of the board’s composition at Vadilal Industries and Vadilal Enterprises, as it stood prior to the NCLT’s judgment.