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Godrej split | Barring real estate and marketing, camps cannot compete with each other for six years

During the non-competency period — none of the two entities shall pay the royalty for using the brand name in the construction (real estate development) and marketing verticals. 'A family group can enter into the exclusive business of the other family group, without the use of the Godrej brand including in their corporate names [sic]'— as per the pact between the two entities.
ourav Mahendra Mishra
Last Updated : 02 May 2024, 08:03 IST
Last Updated : 02 May 2024, 08:03 IST

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While Godrej Enterprises and Godrej Industries under the 127-year-old Godrej Group will now function separately after the recent split, the two entities have decided to use the Godrej brand name in the real estate and marketing businesses while accepting that the two will not compete against each other for the next six years.

It was decided and announced by the Godrej Group in a statement on April 30, 2024 that Adi Godrej (82) and his brother Nadir (73) will manage and own Godrej Industries which has five listed firms. Cousins Jamshyd Naoroji Godrej (75) and Smita Godrej Crishna (74) will own the unlisted Godrej & Boyce along with its affiliates and the land bank comprising prime property in Mumbai.

During the non-competency period— none of the two entities shall pay the royalty for using the brand name in the construction (real estate development) and marketing verticals, said Times of India in a report. The agreement between the two entities further states that after six years, they can enter each other's businesses, but will not be allowed to use the brand name.

The excerpt from the pact between Godrej Enterprises and Godrej Industries reads: "A family group can enter into the exclusive business of the other family group, without the use of the Godrej brand including in their corporate names [sic]".

Godrej & Boyce owns 3,400 acres of land in Mumbai, including a 3,000-acre parcel in Vikhroli, Mumbai. The Vikhroli land by some estimates has a development potential of over Rs 1 lakh crore. It can develop 1,000 acres, while about 1,750 acres are covered with mangroves and is the destination of rare plants and birds. About 300 acres of land have already been encroached upon.

While Godrej Group has announced the split, a regulatory approval for the same is awaited. Once approved, the Group has decided that Pirojsha Godrej will be the Executive Vice Chairperson of Godrej Industries— succeeding Nadir Godrej as the Chairperson in August 2026.

Godrej Enterprises comprises Godrej & Boyce (G&B) and its affiliates, which have presence across multiple industries spanning Aerospace, Aviation, Defence, Engines and Motors, Energy, Security, Building Materials, Construction, Green Building Consulting, EPC Services, Intralogistics, Healthcare Equipment, Durables, Furniture, Interior Design, Architectural Fittings, IT, Software as well as Infrastructure Solutions.

Godrej Industries includes the listed companies, Godrej Industries, Godrej Consumer Products, Godrej Properties, Godrej Agrovet and Astec Lifesciences.

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Published 02 May 2024, 08:03 IST

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