Spat Over Pure Drinks Hots Up, Split Seen

Pure Drinks, the Delhi-based beverage company, may be heading for a split with both promoter brothers, Ajit and Satwant Singh bringing their quarrel over control of the company and its proposed restructuring plans into the open.

At stake is not only a substantial business worth Rs 65-odd crore but also assets worth at least a whopping Rs 800 crore.

In fact, the stakes have been upped with Harjit Kaur, wife of the original promoter, Charanjeet Singh, becoming a surprise partner of Ajit Singh.

Harjit was unceremoniously evicted from the Pure Drinks board a few years ago and is one of the three main stakeholders in Pure Drinks along with the brothers.

The ganging up of aunt and nephew is likely to have major implications for the future of Satwant Singh.

Pure Drinks has 18 per cent of Delhis beverage market and nine plants and sites in major cities including Delhi, Mumbai, Calcutta, Madras, Chandigarh, Ludhiana and Amritsar.

The quarrel, which has been simmering for years, now has both brothers issuing press notices against each other (in leading dailies in Delhi).

When contacted, Ajit Singh admitted to having some problems in the company but said restructuring plans are still on. He added that he and his aunt, Harjit Kaur had decided to bury their differences in the larger interest of the company. The differences between the brothers was unravelled when Ajit Singh issued an office order on January 16, 1997, stating that ..since the company is undergoing financial crisis, it has been decided in the interest of the company to add 30 trucks which will be handled directly by Cadbury Schweppes Beverages (CSBIL) for distribution in Delhi for all products including our brands. It added this move would require restructuring of certain routes also. Satwant Singh, countered this by issuing his own order on January 20 claiming Ajits order to be without authority and that the management had never discussed, leave alone sanctioned, the distribution of products by CSBIL. He said that the company has lost leadership position and is facing difficult times due to certain people

within the ranks. Ashok Jain, country head, CSBIL said his companys plans to undertake a portion of distribution in Delhi was part of its commitment to gain marketshare and distribution network.

The pact with CSBIL is to come into effect by February 1, where the multinational is investing Rs 1.5 crore to help Pure Drinks increase its fleet from 70 to 100 trucks and compete more effectively against the might of Coke and Pepsi.