Fight for Succession of Dainik Jagran Group Reaches NCLT; What Will Be The Future Direction Of The Newspaper?

Dainik Jagran, India’s most widely read daily with a readership of 68 million, is currently facing internal conflicts within the Gupta family, who are the owners of the media group.

The dispute has escalated to the National Company Law Tribunal (NCLT), posing a serious threat to the newspaper’s stability. The group has been actively supporting the ruling BJP and its Hindu supremacist policies through its content, which has resulted in a significant increase in advertising revenue during the tenure of the Modi government compared to the previous UPA government led by Manmohan Singh.

The potential fallout from the family dispute and the legal proceedings could put the newspaper and its investors, including Jagran Prakashan, which has a market capitalization of over 2200 crores, at risk.

However, it’s still early days, and insiders suggest that negotiations are ongoing for a possible out-of-court settlement, similar to the case of the Times Group split between brothers Samir and Vineet Jain, though the latter affair was less public and litigious.
The future of Dainik Jagran and its financial stability hangs in the balance as stakeholders closely monitor the developments and hope for a resolution that can preserve the newspaper’s prominence and success.

The NCLT Filings, Dainik Jagran

The NCLT’s Allahabad bench in Prayagraj took up a company petition filed by Mahender Mohan Gupta, a Jagran Media Network Investment Private Limited director, and his son Shailesh Gupta.

The petition accuses the majority shareholders in the company of oppressive practices. Jagran Media Network Investment Private Limited’s subsidiary, Jagran Prakashan Limited, is responsible for publishing the well-known newspaper ‘Dainik Jagran.’

In its order, the bench, comprising Praveen Gupta (Member – Judicial) and Ashish Verma (Member – Technical), refrained from providing interim relief to the petitioners. Instead, they issued notice and directed all parties to complete their pleadings within a given timeframe. The matter has been scheduled for further hearing on August 9, 2023.

The crux of the dispute lies in the representation of the private company in meetings of the listed company. Mahendra Mohan Gupta claims to be the authorized representative but faces opposition from other branches of the Gupta Family, who dispute his claim.

The petitioners sought a stay on a proposed board meeting of Jagran Media Network Private Limited, where the board intended to nominate members for representation in the meetings of the listed company. However, the Tribunal did not grant the requested stay.

In the legal battle that ensued, the petitioners were represented by a team of eminent Senior Advocates and Advocates. On the other side, the majority shareholders’ legal team consisted of experienced advocates from Karanjawala and Company, along with renowned Senior Advocates who argued the matter on their behalf.

The Legacy
Beyond the legal dispute, Mahendra Mohan Gupta, the chairman and managing director of the Jagran Prakashan group, shares insights into his media empire and the family’s bond.

He emphasizes professionalism in decision-making within the company, which has helped avoid public family disputes that have plagued other family-owned enterprises. The Gupta Family has successfully navigated challenges and grown the media business, adapting to new technologies and innovations.

Mahendra Mohan Gupta holds a significant position in the media industry as the head of Dainik Jagran, India’s largest-read Hindi daily. Despite his political role as a member of Parliament (MP) from the Samajwadi Party in 2006, Gupta maintains a reserved stance on government affairs and the Lokpal Bill, making a clear distinction between his personal views and those of the newspaper.

He candidly discusses the affairs of his media empire, which encompasses print, radio, and outdoor divisions, and addresses queries regarding the company listed on the Bombay Stock Exchange.
One such query pertains to the closure of the Delhi and Bangalore editions of Mid Day, a Mumbai-based tabloid acquired by Jagran in 2010. Gupta explains that the closure was due to financial losses, prompting a strategic decision to focus on growing circulation in Mumbai and Pune.

Despite the internal dispute, the Gupta Family has managed to stay united, thanks to the wisdom of Mahendra Mohan Gupta after the death of his elder brother, Narendra Mohan Gupta, who was a former chairman of the group and a Bharatiya Janata Party MP and Gupta goes on to express hope that the next generation will uphold the family’s values and unity.

The Start
Gupta’s journey in the media industry began in 1954 when he joined his father’s company, which originally started in Jhansi in 1942 to support the freedom struggle. The newspaper thrived after independence and moved to Kanpur in 1947.

The family’s togetherness is evident in their lifestyle, with a large bungalow complex in Kanpur designed with separate wings for each of the brothers. Gupta emphasizes the importance of family gatherings during festivals and other occasions, fostering strong bonds among family members.

Despite the challenges faced by other family-owned enterprises in the media industry, the Jagran group has managed to avoid public family disputes. Gupta attributes this to the professional decision-making process guided by a competent board, as well as early foreign investment and listing of the company.

While some family members are involved in non-media businesses, including education and manufacturing, the majority of the Gupta Family continues to be employed in the company.

The Future
Gupta believes that newspapers will continue to survive despite the rise of electronic and digital media, and he is not discouraged by accusations of imitation.
He remains optimistic about the future of print media and trusts that people rely on morning newspapers for trusted information.

The company’s foray into television with Channel 7 in Hindi was not entirely successful, and they eventually sold it to Raghav Bahl, renaming it IBN7; at the same time, however, Gupta expressed his scepticism about the economic viability of serious news channels.

The Last Bit, the fight for succession within the Dainik Jagran Group, has become a matter for legal resolution at the NCLT. As the dispute unfolds, the family business faces challenges, but Gupta’s leadership and the family’s unity have played a pivotal role in the company’s stability. The outcome of the NCLT proceedings will determine the future direction of the newspaper and its broader implications for the Gupta Family and stakeholders.