From bitter family feuds to delayed success, Analjit Singh has seen it all. What he learnt along the way is now becoming a template for the modern governance of his family business
It is a perfect Monday morning at the stately, elegant bungalow on 15, Aurangzeb Road in the capital. As a gentle breeze blows through the estate and birds chirp in the background, Bhai Analjit Singh opens the large wooden doors of his house to let out his two golden retrievers — whom he calls his fourth and fifth children — on to the perfectly manicured lawn. “It is a nice day, but you never know, this might not last more than 15 minutes,” he says.
This short encounter perfectly sums up Analjit Singh’s approach to life and work. Life has taught him to be circumspect even when the going is good. As a result, he’s learnt never to take anything for granted.
And so today, after almost a decade of trial and error, even as good karma seems to be finally trouncing the bad, Analjit is busy figuring out new ways to secure the future of his family and business.
The Rs. 7,250 crore Max India Group that Analjit Singh built after selling his stake in telecom firm Hutchison Max to Hongkong-based tycoon Li Ka-shing back in 1998 is finally hitting a sweet spot. His life insurance business, built through a joint venture with New York Life, is on the verge of turning profitable this year. The Max healthcare business is just beginning a massive, yet carefully orchestrated expansion. And Max Bupa, the health insurance joint venture with Bupa, has got off to a good start since its debut a year ago.
All these good tidings might make the bitter family disputes that Analjit Singh had to endure in the past a distant memory and his initial trials just a footnote in his mercurial career. But he hasn’t forgotten them. In fact, he remembers them so well that he is drawing lessons to avoid their repetition in his own family.
To achieve that, Analjit has now put in place a new governance model at Max. In this pathbreaking endeavour he is getting help from some of the best minds in the business: World-renowned management guru Ram Charan and two of Singh’s closest confidants, Anuroop ‘Tony’ Singh and Ashwani Windlass.
He has also spent time scouting for luminaries from around the world to join his board — and then also giving them the freedom to challenge him and his CEOs to raise the bar. And it seems to be paying rich dividends already.
At home, his three children — son Veer, 27, and two daughters, Piya, 28 and Tara, 24 — are about to embark on their own entrepreneurial journeys. Singh says he is enjoying working with the next generation — each with their own ideas and bundles of new energy — to build the platform for four new ventures in integrated medicine, senior living, medical education and hospitality. This is part of his larger plan to train the youngsters to be “responsible owners”. And that means his children don’t get any operational roles in the publicly listed company. Alongside, a detailed process has recently been kicked off inside the family to build a trust and a family office to preserve — and conserve — the family wealth. It almost looks picture perfect.
But the indulgent family man and the seasoned businessman knows that it doesn’t take long for the weather to change. He needs to remain vigilant and consolidate the gains he has made so far. For Analjit Singh, the journey of discovery has just begun.
A Raw Deal
For more than two decades, Analjit Singh stood witness and was a part of the messy disintegration of what was once the Indian pharmaceutical industry’s first family.
It had all started in 1990 when differences cropped up over how Ranbaxy patriarch Bhai Mohan Singh divided assets among his three sons — Parvinder, Manjit and Analjit. In that family settlement, Ranbaxy went to the eldest sibling, Parvinder, much of the real estate went to Bhai Manjit Singh, and Analjit was left with just an overstaffed factory at Okhla.
Three years later, the father was ousted from Ranbaxy by Parvinder in a boardroom coup. While the dispute in courts dragged, things took a turn for the worse with the demise of Bhai Mohan Singh in 2006. Claims and counter-claims were made on his father’s will. Though Analjit eventually made peace with his nephews — Malvinder and Shivinder after their father passed away in 1999 — differences with brother Manjit continue, spilling over to, among other things, the Aurangzeb Road mansion where Analjit now lives.
Then, in 2008, much to Analjit’s horror, his nephews cashed in by selling the family jewel Ranbaxy to Japanese pharma giant Daiichi Sankyo for $2.3 billion. Singh won’t admit it publicly, but his close associates say that the Ranbaxy sell-off affected him deeply because he saw it as family silver being squandered away.
Yet, getting the model right on healthcare was time-consuming. While the life insurance business got off to a good start under the leadership of Tony Singh and with the help of an experienced JV partner, it took extra effort from Analjit to get the model right for the hospital chain business of Max Healthcare. While Apollo and Fortis were building big hospitals before opening smaller clinics, Max was going the other way around. For a while, Analjit had to bootstrap the business, even donning two hats, that of chairman and CEO for a couple of years starting 2005. Besides, insiders remember him being quite a stickler for detail. He is said to have been involved in every minute detail, even choosing the furniture in the office and hospital. It was only after loans from Asian Development Bank and International Finance Corporation fructified in 2003, did the business begin to stabilise.
Messrs Theron and Coleman are an intrinsic part of the crack team that Analjit gathered from around the world. Seven months before he roped them in, he hadn’t even known them. For someone who often demanded “getting into each and every point,” Analjit’s willingness to seek counsel surprised his own colleagues.
The New Deal
(This story appears in the 22 April, 2011 issue of Forbes India. To visit our Archives, click here.)