Nusli Wadia- As shared

It is perhaps in Nusli Wadia’s genes to put up a fierce fight when it
comes to the crunch. After all, that is how his maternal grandfather,
Muhammad Ali Jinnah, carved out a whole new country, Pakistan, in
1947. It could also stem from the fact that the chairman of the
Mumbai-based $2.5-billion Wadia group hates being wronged.
Once described as “the epitome of South Bombay’s old money and genteel
respectability,” Wadia today lords over an empire that includes
textile company Bombay Dyeing, consumer goods maker Britannia, and
airline company GoAir.
And today, at 72, this samurai of corporate India is once again
bracing for battle, this time positioned against his childhood friend
Ratan Tata and India’s largest conglomerate, the 148-year-old Tata
Group.

It all began last week when, as an independent director with a number
of Tata Group companies, Wadia extended his support to Cyrus Mistry,
the deposed chairman of the conglomerate. Mistry was booted out a few
weeks ago due to numerous reasons, including his alleged inability to
generate adequate profits and his “devious” plan to wrest control of
the group from Tata Sons, its holding company.
Since then, the Tata Group and Mistry have been engaged in bitter
mudslinging. Mistry has refused to relinquish the chairmanship of many
group companies and has found support from several independent
directors, including Wadia. The Tatas have moved legally and are now
looking to oust both Wadia and Mistry.
As the drama unfolds further, there will be much at stake for Wadia:
his personal relationship with Ratan Tata, whom he has helped over the
past two decades—Tata was on the board of Bombay Dyeing for 33
years—and his relationship with the $103-billion Tata Group whose
former chairman, JRD Tata, was his godfather.
Corporate samurai

Wadia started out fighting his own father, Neville Wadia.

Set up in 1879, the famed Bombay Dyeing is one of India’s oldest
textile-makers and became a household name by the 1970s. In 1971,
Wadia senior decided to settle abroad and sell the company to
Kolkata-based businessman, RP Goenka, owner of the prominent tyre
company CEAT Limited. This decision was taken in concurrence with
Cyrus Mistry’s father Pallonji Mistry who then held a 7% stake in the
Wadia company.
The younger Wadia would have none of it, though. “I don’t want to be a
second-class citizen in some European country. I am going to live in
India. And I am going to run Bombay Dyeing,” he is reported to have
told his father. Wadia’s lawyers had also told him that his father
didn’t have the right to unilaterally sell the family’s stake.
Educated at Rugby School in England, a 19-year-old Wadia returned to
India in the mid-1960s after spending 11 years abroad. He joined
Bombay Dyeing as an apprentice on a monthly salary of Rs180 before
undergoing its executive training course. He became the joint managing
director in 1970.
Wadia managed to acquire 11% of the company’s shares. In this, he was
helped by his mother—Jinnah’s daughter Dina married Neville in spite
of her father’s disapproval and remained in India even after he
founded Pakistan—and JRD Tata, the then chairman of Tata Group.
The childless JRD had taken a particular liking to Wadia. On his part,
the young man considered JRD his mentor. Such was the warmth between
them that Wadia even named his younger son Jeh, after the Tata Group
patriarch. Evidently, this warmth was missing between JRD and Pallonji
Mistry who held an 18% stake in the Tata Group, too. This helped
Wadia’s cause.
Meanwhile, Wadia had persuaded the company’s employees, too, to pitch
in with their savings.
With Bombay Dyeing in his kitty, Wadia was now ready for more battles.
These included those against tycoons such as Reliance Industries’
(RIL) Dhirubhai Ambani and the Britannia group’s Rajan Pillai, among
others.
The decades-long war with Ambani

Wadia’s clash with Ambani to control the country’s textile industry
was one of the most ferocious in the history of corporate India. It
was widely perceived as one between an ancient regime and the nouveau
riche.
The Wadias, after all, were one of India’s wealthiest and most
established business families of the time. The group started out in
1736 when Lovji Nusserwanjee Wadia, a Surat-based businessman widely
considered as the father of the Indian shipping industry, set up a
marine construction company that built 355 ships, including the first
one built for the British navy outside England.
By the late 1970s and early 1980s, however, Bombay Dyeing had come
under serious threat from RIL, led by Ambani, then a young and
upcoming textile baron.
Wadia had the licence to import dimethyl-terephthalate (DMT) to make
polyester while Ambani had one for purified terephthalic acid (PTA).
DMT and PTA are key ingredients in the production of polyester. Ambani
emerged victorious by allegedly persuading the government to hike
duties on chemicals used to make DMT. A badly-hit Bombay Dyeing had to
shut down its plant in 1986.
Not willing to give up, Wadia allegedly used his newspaper-baron
friend Ramnath Goenka’s publication to accuse Ambani of manipulating
government policies.
“To some extent, yes (I did miss the bus), but that’s because I chose
not to manipulate the system… I want to live by a set of values that
is integral to anything that we do,” Wadia said in 2012. “All the
policies related to polyester and the polyester chain during the 80s
were manipulated. You had to manage the system for all licences.”
The war continues

In the early 1990s, Wadia was called upon by JRD to be his
heir-apparent at the Tata Group, which Nusli refused. Instead, he
helped Ratan ease into his new role. Together, the duo ensured the
ouster of the Tata Group old guard that was revolting against Tata’s
appointment. “I was helping someone who has been my friend from the
age of three,” Wadia reportedly said back then.
Around this time, another front was opening up for what is today the
jewel in his group’s crown: biscuit-maker Britannia Industries.
Set up in 1892 in Kolkata, Britannia sold biscuits to the British army
even during the World War. By 1993, Kerala-based cashew businessman
Rajan Pillai owned a 38%-stake in it. Pillai later brought in a French
partner, Danone.
However, Danone turned wary of Pillai, suspecting that it was being
betrayed. With Wadia’s help, Pillai was forced to give up control;
Pillai then fled to Singapore following allegations of defrauding
Britannia. In 2009, Danone, too, sold its stake after Wadia dragged
the company to court for allegedly violating a non-compete clause.
Britannia also accused Danone of intellectual property violation over
the Tiger brand of biscuits.
But that’s not all.
In 2000, Wadia thwarted an attempt at a hostile takeover of Bombay
Dyeing by Kolkata-based jute businessman, Arun Bajoria. He is also
fighting Mumbai-based real estate firm Raheja group over a
Rs24,000-crore property in the city.
Today, as he heads for another clash, Wadia must apply all the skills
of the corporate samurai that he is. The war may not be anything like
before. But if there is anything that these years have taught him, it
will be that he isn’t going to accept anything that would challenge
his destiny.
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