Inheritance Clash in India's Automotive Royalty: The Kapur Family Feud

A high-stakes inheritance dispute has erupted within the Kapur family following the death of Sunjay Kapur, heir to India's Sona Comstar empire. As accusations of suspicious circumstances swirl, the battle for control of the automotive giant exposes the lack of succession planning among family-owned businesses in India.

An untimely heart attack on June 12 left Sunjay Kapur, 53, heir to the $3.6 billion Sona Comstar, at the center of an intense family feud. The company, a leader in India's automotive component sector with a global presence, has seen the question of inheritance turn into a spectacle of media scrutiny. Kapur, an elite polo player and socialite, had connections reaching into the upper echelons of Delhi society, including close ties to Prince William.

His abrupt passing has opened the floodgates to speculation and rivalry among surviving family members, primarily involving Rani Kapur, Sunjay’s mother and former chairperson of Sona Comstar. On July 24, she sent a letter to the board demanding a postponement of the company’s annual general meeting (AGM), scheduled for the following day, while calling into question the validity of her son’s death and subsequent company actions. Rani alleged that the circumstances surrounding his passing were “highly suspicious” and claimed she was pressured into signing documents at a time of emotional turmoil.

Despite her protests, the AGM occurred as planned on July 25, resulting in the appointment of Priya Sachdev, Sunjay’s wife, as a non-executive director. Rani Kapur contends that her deceased husband’s will names her as the sole beneficiary of the family estate, including a majority stake in Sona Group, but the company has refuted these claims, highlighting her lack of involvement in Sona Comstar since 2019.

The corporate dynamics are further complicated by the structure of Sona Comstar, where 71.98% of shares are held by public shareholders and 28.02% by family-controlled Aureus Investments Pvt Ltd. Legal experts indicate that Rani Kapur lacks voting rights in the company, complicating her claims to ownership.

This familial discord underscores a larger problem affecting family businesses in India. A recent PwC survey indicates that around 90% of listed companies are family-controlled, yet only 63% have a proper succession strategy in place, leading to disputes once the founding patriarch or matriarch passes away. Observers note that ambiguous ownership structures and the absence of formal succession guidelines often lead to bitter conflicts.

High-profile succession battles are not new to India, with other immense family-run businesses, like the Reliance Group, famously torn apart by similar issues. Experts suggest creation of clear governance frameworks and succession plans as the key to maintaining harmony within family enterprises.

Notably, some families, like the Bajaj Group, have learned from prior conflicts, opting for structured governance and shared responsibilities to foster peace and stability. As the Kapur family grapples with their legacy amidst this upheaval, industry watchers hope they take heed of the lessons learned by others, reinforcing the need for effective succession planning to secure the future of their enterprise.