Wealth and Fraud: The Spectacular Life and Death of Biscuit King Rajan Pillai

In his obituary, new york times Called him “one of Asia’s most flamboyant businessmen.” This refers to his lavish lifestyle, which included seaside homes in Mumbai and London’s Holland Park, where he entertained politicians and other influential figures. He also likes Rolex and Dom Pérignon.

early start

Like many other ambitious young entrepreneurs, the son of a cashew nut merchant was an early entrepreneur. When he was just 20 years old, he invested in a hotel in Goa and made his first money there. Soon after, he decided that India’s notorious licensing regime, which peaked in the 1970s, was not conducive to the rapid growth he aspired to achieve, so he shifted his base to Singapore.

He teamed up with Canadian businessman Frederick Ross Johnson, then head of American multinational Standard Brands, to form 20th Century Foods, which sold packaged potato chips and peanuts. The startup didn’t make him much money, but he endeared himself to Johnson. Johnson would later become a key figure in the infamous Nabisco management buyout battle, as revealed in the gripping 1990 book. Barbarians at the Gate: The Fall of RJR Nabisco Authors: Brian Burrough and John Heliar.

Impressed with Pillay’s bold moves and dealmaking abilities, Johnson put him in charge of Standard Brands’ Nabisco Merchandise Company. He did well enough and was appointed to run the Asian subsidiary of British biscuit company Huntley & Palmers.

This proved to be the springboard for his trysts in India, as the British company had a controlling stake in the Great British India Company. Pillai bought a stake in the company and now business is booming. Over the next few years, he partnered with French food company BSN (which later became Danone) and acquired shares in six companies in Asia, earning him the title “Biscuit King.”

The entry into India also included a much-anticipated, but aborted, deal with Coca-Cola to relaunch its operations in the country. Ultimately, the U.S. sparkling wine giant called off the talks, choosing instead to go it alone. One reason may be that Pillai’s growing empire was crumbling under mounting debt. By 1993, financial conditions became dire, forcing him to begin selling some companies.

challenger

It was here that he crossed paths with another corporate warrior, Nusli Wadia, a survivor of many bloody takeover battles. Pillai’s seemingly unstoppable force met Vaidya’s immovable object, and the former had to give way.

Through a series of moves, Wadia acquired an equal stake in Britannia as Danone, and together the two ousted Pillay from the board. Pillai’s claim to control of the company is weak as Wadia and Danone control 51% of the company. Pillay’s ouster has come at a huge cost, with his former mentor Johnson now demanding he pay up for the funds originally provided for his return.

Short of cash and unable to repay debts, Pillai was taken to court by Singapore’s commercial affairs department on multiple charges, including breach of trust and fraud and owing debts of US$17.2 million. However, he was too cunning a customer to be caught so easily. He fled the country for India the morning of his sentencing. After returning home, a Kerala court granted him bail and he was initially given a suspended sentence, but was later arrested by the CBI in July 1995 at Delhi’s Meridien Hotel.

downfall

Pillai now sees the other side of fame and fortune. His former friends and social acquaintances dropped him like hot potatoes. As a disciple of Chandraswami, who wielded great influence in the corridors of power, he sought help from the self-proclaimed godman. No one came.

Suffering from cirrhosis of the liver, he died in July 1995 just four days after being imprisoned, apparently due to a lack of medical attention.

His cantankerous wife Nina Gopika Nair claimed his death was part of a conspiracy, although later in court she refused to name the alleged conspirators.

However, a committee headed by Justice Laila Seth did investigate the allegation. Although it found no evidence of a conspiracy, it recommended major reforms to a prison system that allowed patients to die without receiving treatment.

Pillay is certainly no angel when it comes to dodgy business practices, as the charges against him prove. But he does have a passion, and it takes a bold attitude to succeed in global business. His unbridled ambition led him into debt and his tendency to take on too many powerful opponents, which also proved his undoing.

But for his efforts, he deserved better than a painful and lonely death in a cell. wasted deatha book about him written by his brother Rajmohan Pillai, succinctly sums up his life.