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FB Roundup: Kumar Birla, Alexandre de Rothschild; Alberto Safra

In this week’s FB Roundup, Kumar Birla appoints his children as directors of the Aditya Birla Group; the Rothschild family plan to take their investment bank private; and the son of Brazilian billionaire Banco Safra founder sues his family.
Indian billionaire businessman and philanthropist Kumar Birla.

Kumar Birla appoints children as directors of Aditya Birla Group
In a purported succession overture, Indian billionaire businessman and philanthropist Kumar Birla has appointed two of his children as directors to oversee the retail unit of the Aditya Birla Group.

The group, which is one of India’s largest global conglomerates operating in 100 countries with more than 140,000 employees across textiles, fashion, cement, telecoms and financial services interests, inducted daughter Ananya Birla, 28, and son Aryaman Vikram Birla, 25, marking the entry of the fifth generation of the family into the $60 billion business.

“Their nuanced understanding of new-age business models and emerging shifts in consumer behaviour will infuse fresh energy to the board of Aditya Birla Fashion,” said Aditya Birla Group chairman Kumar Mangalam Birla.

The appointment of Ananya, a successful businesswoman and platinum-selling musician, and Aryaman, who has previously worked across several businesses owned by the group, took place earlier this month and is expected to be the first step in their eventual takeover of the family business.

“A lot of thought has clearly gone into this decision. Fashion and retail is an area where they can relate very closely compared to the group’s other businesses,” said Professor Kavil Ramachandran, a senior adviser at the Thomas Schmidheiny Centre for Family Enterprise at the Indian School of Business, in an interview with Mint. “Their induction into the group will allow them to learn and develop as responsible inheritors.”

Now aged 55, Kumar Birla took over as chairman of the Aditya Birla Group in 1995 at the age of 28, following the death of his father Aditya Vikram Birla. During his tenure as chairman, the group's annual turnover increased from $2 billion in 1995 to $45 billion in 2021.

Rothschild family planning to take investment bank private
The famed Rothschild family are planning to move their Paris-listed investment bank, Rothschild & Co, private by buying out the remaining 45% of shares they do not already own.

In a move that would take the company off the stock market, Concordia, the family-owned holding and Rothschild & Co's largest shareholder, is ready to tender an offer for the bank’s remaining shares at €48 euros each, Rothschild said in a statement.

“Each of the businesses is better assessed on the basis of their long-term performance rather than short-term earnings. This makes private ownership of the group more appropriate than a public listing,” said Rothschild & Co in a statement of the take-private plan, which will be submitted to shareholders on May 25.

Concordia said that none of Rothschild & Co’s three divisions - global advisory, wealth and asset management and merchant banking - need access to public capital, so moving private made more sense.

Founded more than 200 years ago, Rothschild & Co was restructured in 2012 following a merger between the then separate French bank and UK merchant bank NM Rothschild & Sons. In 2019, David de Rothschild passed on the mantle of Rothschild chair to his son and seventh-generation family business leader Alexandre. Over the past year, Rothchild & Co has worked on Volkswagen’s initial public offering of Porsche, Covea’s $9 billion acquisition of PartnerRe and the nationalisation of German energy group Uniper.

Son of Brazilian billionaire Banco Safra founder sues family
Banking heir Alberto Safra is suing his mother and two of his brothers in a dispute over the fortune of his late father, Lebanese-Brazilian billionaire banker Joseph Safra.

According to Reuters, Alberto has accused his family of “Purposely diluting his stake in a holding company of Safra National Bank in an effort to oust him from the family empire”.

In the lawsuit, Alberto claims that his mother, Vicky Safra, and brothers, Jacob and David Safra, had “engaged in acts of corporate misconduct to damage his interests in the company”.

“Due to illegal and aggressive acts committed by his brothers, Alberto Safra had no choice but to file a lawsuit with the Supreme Court of New York to protect his rights,” read a statement on behalf of Alberto.

“The conduct alleged in this action was part of an ongoing, coordinated effort by the family defendants to dilute Alberto’s ownership interests in businesses owned by the Safra family around the globe, for which Alberto is seeking relief in multiple jurisdictions.”

Alberto Safra, one of four children of the late Joseph Safra, was responsible for corporate banking at Banco Safra until October 2019. He left his position following a dispute with his brother David over the bank’s expansion into retail banking.

The Safra family's fortune, which was founded more than 180 years ago and has grown with the establishment of Banco Safra in Brazil, Safra National Bank of New York in the US and J Safra Sarasin in Switzerland, as well as real estate including the ‘Gherkin’ building in London and 660 Madison Avenue in New York, has been under scrutiny following a contested succession plan.

In 2021, Alberton challenged three new wills his father executed in 2019. Joseph Safra passed away in 2020, leaving his wife and children approximately $7.3 billion each, according to the Forbes list of The World's Billionaires.

A spokesperson for the Safra family has since claimed that Joseph Safra willingly wrote his son out of the will after Alberto left his position at Banco Safra and started a competing company, ASA Investments.

“Now Alberto promotes a dispute against the whole family, saying that his father would have no reason to do what he did, claiming it was a conspiracy to harm him,” the family's spokesperson said.

“The family regrets the path taken by Alberto, who first attacked his father while he was alive and is now attacking his memory, and refutes his allegations.”

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