The Godrej family is synonymous with landholdings and the maintenance of what is the largest privately managed mangrove belt in the city.
Of the 3,401 acres located in the eastern suburbs of Mumbai, roughly 1,750 acres of mangroves are part of the Soonabai Pirojsha Godrej Foundation.
A few years ago, when talks of a separation began between the two families — Adi Godrej, Nadir Godrej and family (Godrej Industries and associates) and Jamshyd Godrej and extended family — real estate was a moot point which brought to the fore questions about how the asset will be divided.
Sources close to the family told TOI it has been decided that G&B which owns the real estate will retain it as well.
TOI has learnt that senior directors across group companies have been sworn to secrecy not to talk about the negotiations. Besides, there is an embargo on them not to sell or trade in Godrej stocks till then. An insider, when contacted by this newspaper, said it makes sense for G&B to retain the entire land.
“While the probability of apportioning the land through a separate vehicle was discussed, it was difficult to execute it as it would attract a huge stamp duty payment based on the ready reckoner value of the land,” said the source. “The 5% stamp duty would kick in even if the land were to be transferred from one group company to another,” said the source.
The decision to vest the land in G&B will in turn boost the valuations of the company, said sources. It could make the family business separation an expensive proposition for Jamshyd Godrej’s side. Turnover wise, the unlisted G&B (Rs 11,400 crore in 2019-20) is half the size of Godrej Industries & associate companies (around Rs 21,000 crore). It is not clear whether Godrej Properties, which is part of Godrej Industries and associate companies, would continue to benefit by developing properties on land owned by G&B, following the family separation.
Over and above the 3,401 acre land which belongs to G&B, there is a separate land parcel on which the Godrej Group has been in dispute with the state government since 1973 over who controls the land. The state claims the land belongs to it and had filed a suit against G&B in that year. The dispute is pending before the Bombay high court.
In response to TOI’s query on this matter, the Godrej family said in a joint statement: “The Godrej family has been working on a long-term strategic plan for the group for the last few years to ensure best value for its shareholders. As part of this exercise, we have also sought advice from external partners. These discussions between the family remain ongoing.”