Sometime in the early 80s, a 20-year-old lad from Kolkata used to board an unreserved compartment of a Mumbai-bound train twice every month. He would park himself and the 4,000 betel leaves he carried next to the compartment's filthy toilet to keep the leaves fresh by sprinkling water during the 30-hour journey. On the ride back, the young man would bring along toys to sell in Kolkata's wholesale market. The total earnings after a roundtrip: Rs 200.
Today, Nikhil Gandhi, 51, moves around in a chauffeur-driven Merc E series, stays in a tony Napean Sea high-rise in Mumbai, and rubs shoulders with the city's high and mighty.
His net worth is at least Rs 2,500 crore, going by the closing price of two of his main listed companies, Pipavav Defence & Offshore Engineering (formerly Pipavav Shipyard) and Everonn Education. It will quadruple if a proposed sale of equity in his holding company, SKIL Infrastructure, to the private equity arm of JPMorgan goes through.
And, now the Kolkata boy is thinking even bigger. His grand plan is to invest $5 billion in next six years: $1 billion in the shipyard and defence businesses, and $2 billion each in infrastructure and education. Investors - Indian and global - are keen to buy into Gandhi's ambitions. SKIL has signed a non-binding term sheet to sell 18% to JPMorgan PE for $400 million, which values it at $2.2 billion.
Shades of Grey in Rags-to-Riches Story
AIG owns 7% while Nitin Nohria, dean of Harvard Business School (HBS), and Mark Maletz, a senior fellow at HBS, together own 3%. Maverick investor Rakesh Jhunjhunwala has picked up a minority stake in Pipavav Defence. "I consider myself to be a good judge of entrepreneurial leadership. I was so impressed by Gandhi's capabilities that I invested in his holding company," says Maletz, who knows Gandhi for six years. Between the rags, riches and rapture, however, lurk shades of grey.
One of those hues came to the fore last fortnight when the founder chairman of Everron, in which Gandhi owns 21% and is the second-largest investor, was arrested on allegations of bribing an income-tax official. Gandhi may have had no role to play in that scandal, but the event has scarred Everron and its investors.
Gandhi says he is committed to his investment in the education firm. "Everonn is a fundamentally sound company. I will support it to steer out of the mess," says the man who is no stranger to controversy and has invited the wrath of the market regulator and stock exchanges in the past.
Grey Shades:
The National Stock Exchange had suspended trading in a Gandhi-owned company, Horizon Infrastructure, for almost eight years, beginning March 2000, for not complying with listing agreements. Then, in September 2009, market regulator Sebi had charged key officials of KLG Capital Services, another Gandhi firm, with insider trading and barred it from the stock market.
Gandhi attributes the non-compliance issue to the former promoter of Horizon from whom he had acquired the company. But he admits it was his lapse as well. He denies the insider trading charges, and had appealed to the apex body, the Securities Appellate Tribunal, which set aside the Sebi order. If investors are willing to ignore the warts, and back this first-generation entrepreneur, that's because he has a record - of building infrastructure businesses from scratch.
Click here to read original article.
No comments:
Post a Comment