Mumbai: One of India’s top investment bankers, Nimesh Kampani, has decided to step down as managing director of JM Financial Ltd, the company he founded and built into one of India’s top i-banks. He will leave the post on 30 September, when he turns 70.
Kampani, who will continue as chairman, albeit in a non-executive role, was the confidant of many of India’s top family business groups.
He led several deals, including Gujarat Ambuja Ltd’s purchase of ACC Ltd’s assets, represented the interests of arch rivals, the late Dhirubhai Ambani and Nusli Wadia, and played mediator when Mukesh Ambani and his younger brother Anil Ambani had a falling-out. The Tata group, the Aditya Birla group and both Reliance groups were his clients.
“I believe it is important for all businesses to implement a proper succession plan and I am committed to follow the same,” he said in a statement released by the company.
Kampani will be succeeded by his son Vishal Kampani. Nimesh Kampani couldn’t be reached for comment.
Kampani was part of the legendary 3 Ks of the Indian investment banking scenario in the late 1990s and early 2000s, when foreign investment banks were yet to establish themselves in the country (Uday Kotak of Kotak Mahindra and Hemendra Kothari of DSP Merrill Lynch were the other two).
Kampani (like the other two Ks) was trusted by the promoters of family business groups. A senior executive at one such conglomerate said that even while Kampani was advising one group on a spin-off, he would be advising a rival one on an acquisition.
It didn’t matter to the groups (who would only get to know after the two transactions).
“They were pretty comfortable with Kampani as he kept secrets as divine secrets,” added this person, who asked not to be identified.
In Mumbai’s investment banking circles, Kampani remains a legend. Ajay Garg, founder of Equirus Capital, a Mumbai-based boutique investment bank, said Kampani is among the most astute dealmakers the market has seen.
“Nimesh bhai” (Nimesh brother) is a father figure and one of the most influential persons on the deal street, said another investment banker, Mahesh Singhi, founder and managing director of Singhi Advisors.
Kampani’s relationships with the patriarchs of some of India’s biggest business houses encouraged Morgan Stanley to seek a joint venture with him.
JM Morgan Stanley was formed in 1997. The partners decided to go their separate ways in 2007.
“After Morgan Stanley, JM has bounced back and the baton is now being passed on to professionals led by his son Vishal,” added Singhi.
Kampani is also expected to oversee the activities of JM Financial’s philanthropic arm, JM Financial Foundation.
Kothari, former chairman, DSP Merrill Lynch Ltd, said: “Nimesh will remain active in business and other areas of life.”
Kothari and Kampani were in the same class in college and played cricket together.
“We started the investment banking industry in India. We remain good friends,” said Kothari.
Kothari stepped down from the company on 31 March 2009. Kothari and Kampani had worked together in many deals, including several high-profile initial public offerings (IPOs).
“We had many clients and also enjoyed a healthy competition. We worked together on the Tata Consultancy Services Ltd IPO, for example, and worked on public sector undertakings’ share sale issues. We have worked together in deals for many major corporations. If my memory is correct, we may have worked together on more than 100 IPOs,” said Kothari.
He added that Kampani had been mentoring Vishal for several years now, preparing him for the top job. Vishal currently serves as non-executive director at JM Financial Ltd and managing director of JM Financial Products Ltd, the group’s non-banking finance company.
Vishal also heads the institutional securities business of the group. He launched the asset reconstruction business in 2008 and the real estate and commercial finance businesses in 2009.
Even as Vishal was doing all this, Kampani Sr. was happy to be in the background. Even in a company renowned for its secretiveness, Nimesh Kampani was an outlier in terms of his lower-than-low-profile.
A controversy in late 2008 made him even more wary of the public eye. Kampani was forced to live the life of a fugitive for a few months starting December 2008 in Dubai.
That was the time he was battling the Andhra Pradesh government and the state’s police to avoid arrest in a case involving a Hyderabad-based non-banking finance company where he had served as an independent director till April 1999.
Starting December 2008, and over a few months, 93 complaints against him were lodged with the Andhra Pradesh police, charging him with criminal breach of trust and cheating under the Indian Penal Code, 1860, and Andhra Pradesh Protection of Depositors of Financial Establishments Act, 1999.
In April 2009, the Supreme Court granted a stay on the arrest of Kampani on charges of allegedly defrauding depositors of Nagarjuna Finance Ltd, paving the way for his return.