Amara Raja takes trust route to ring-fence family wealth

Promoters of family-run cos are increasingly opting for the family trust model to protect their ownership

- Ayaan Kartik

Amara Raja Energy and Mobility Ltd's ageing patriarch recently farmed out the promoter entity's 33% holding to four new family trusts, hopping on an increasingly popular—but not always successful—route for promoters to secure family wealth.

Ramachandra Naidu Galla, 86, is the controlling trustee of the four family trusts, according to a recent exchange filing by India's second-largest manufacturer of lead-acid batteries.

"The settlement into the said family trusts is proposed to enable structured and seamless intergenerational succession of Dr. Ramachandra Naidu Galla (promoter of ARE&M) assets, including shares/control, so as to eradicate the possibility of future conflict," Amara Raja said in a filing published by the stock exchanges on 3 March.