Portfolio company chairman issues writ against Actis

The chairman of a portfolio company owned by Actis plans to sue the private equity firm for its alleged failure to prevent the company losing value.

Rakesh Malhotra has issued a writ of summons against a group which includes Actis Consumer Grooming Products, Actis LLP, and four Actis executives – Shomik Mukherjee, a partner and head south Asia – private equity; Ganapathi Rathinam, a partner – industrials; Peter Schmid, a partner and co-head of private equity, and Alistair Mackintosh, a partner and chair of the investment committee – in relation to Super-Max Mauritius, a razor blade manufacturer which the private equity firm acquired in 2011.

Since Actis acquired the group, its value has fallen sharply, despite the markets in which the company operates growing rapidly, a spokesman for Malhotra said.

But he declined to provide any figures to support this claim, saying: “as the company is a privately owned if [Malhotra] does not have to make the figures public at this stage he would prefer not to.”

Mediation between the two sides failed, and legal action is being taken as a last resort, according to Malhotra’s spokesman.

At this stage, legal action is not inevitable. The writ must be served within a predefined period of time of having been issued in order for a court case to start.

A spokesman for Actis said it was company practice not to comment on the detail of any legal proceedings in which it may become involved.

“In this case we are aware a writ of summons has been issued in the Cayman Islands but it has not been served on any Actis-related party. Should this position change we would defend our position vigorously, as appropriate,” the spokesman said.

The case, should it materialize, will be heard in the Cayman Islands.