SEBI Clears Vadilal Promoters’ Family Trust Restructuring, Grants Open Offer Exemption
SEBI has exempted IVG Trust from mandatory open offer rules, allowing the Vadilal promoter family's succession restructuring without altering promoter control or public shareholding.
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Market regulator SEBI has approved a promoter family restructuring involving Vadilal Industries and Vadilal Enterprises by exempting IVG Trust from the mandatory open offer requirement under takeover regulations.
In two separate orders dated July 3, SEBI Whole-Time Member Kamlesh Chandra Varshney granted the exemption to IVG Trust, an irrevocable discretionary private family trust established by the promoters of both companies. The regulator said the proposed restructuring is part of succession planning within the promoter family and does not involve any commercial consideration.
SEBI observed that the proposed transactions will not alter the overall promoter shareholding, result in a change in control of either company, or adversely affect public shareholders. The exemption allows the trust to complete the share transfers without triggering an open offer under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations.
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Trust Restructuring:
The restructuring centres on IVG Trust, which was established in July 2025. Ila V. Gandhi is the settlor, while Virendrabhai Ramchandra Gandhi and Janmajay Virendrabhai Gandhi are the trustees. The beneficiaries include Virendrabhai Gandhi, Ila Gandhi, Janmajay Gandhi and his lineal descendants.
Under the approved restructuring, IVG Trust will directly acquire 2,81,458 shares, or 3.92 percent, of Vadilal Industries. The transfer will follow the gifting of shares by Ila Gandhi and Janmajay Gandhi to Virendrabhai Gandhi, who will subsequently transfer the consolidated holding to the trust.
The trust will also indirectly acquire control over promoter entities- Vadilal International Pvt. Ltd., Vadilal Finance Company Pvt. Ltd., Veronica Constructions Pvt. Ltd. and Axilrod Pvt. Ltd.which together hold 47.2 percent of Vadilal Industries.
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SEBI noted that the promoter group's aggregate stake in Vadilal Industries will remain unchanged at 64.72 percent following the restructuring, while public shareholding will continue at 35.28 percent.
For Vadilal Enterprises, IVG Trust will directly acquire a 10.64 percent equity stake through transfers from Virendrabhai Gandhi after he consolidates shares received as gifts from Ila Gandhi and Janmajay Gandhi. The trust will also indirectly acquire another 5.02 percent through the acquisition of an 88 percent stake in Axilrod Pvt. Ltd., a promoter entity holding shares in the company.
The regulator said the promoter group's combined holding in Vadilal Enterprises will remain at 51.06 percent, while public shareholders will continue to hold 48.94 percent.
SEBI noted that the exemption application was initially submitted in August 2025 and later revised after the trust informed the regulator that a proposed Hindu Undivided Family (HUF) partition would no longer be pursued. During the review, the regulator sought clarifications regarding inconsistencies in the names of the settlor, trustees and beneficiaries across KYC records, the trust deed and stock exchange disclosures. The trust subsequently amended its deed and submitted fresh undertakings.
