The Last Rites?

Amitabh Bachchan's dismal free-fall form grace is far from over. With the much-hyped Mrityudaata imploding, Bachchan is taking some desperate measures. More than 70 ABCL employees have been given termination notices without as much as a by-your-leave. Round two has been the sale of the Big B audio division camouflaged as a tie-up with T-Series, and the shutting down of Star Track, the event management and talent scouting division of ABCL. And the fitting finale: the search is on for a new buyer. Which is Kenya-based businessman Ketan Somaiya, on whom Aby Baby is looking to offload a large chunk of his stake-and his troubles.

All these steps have elicited wary observations from most industry-watchers. Commenting on the search for buyers, Sunil Manchanda of MAD films says: "If he is trying to raise funds and expand the capital base, then disposing of small stakes makes sense." "They are realigning their business position and that is good," feels Amit Khanna, Plus Channel chief. "Anyway, nobody is privy to the actual position of the company."

The position, if sources are to be believed, does have all the making of a masala mix and ABCL. honchos are finding it increasingly difficult to tone down the spice. The biggest business story, trumpeted as a pathbreaking attempt to corporatise the film industry, say disgruntled employees, has turned out to be a yarn. Dreams die fast.

"We realised what was happening when TV Asia USA was closed down in December '96-January '97. One professional could be wrong but 12 professionals would not walk out at one time in April. Why, even the company secretary walked out," says a former highly-placed ABCL executive.

Refuting allegations of executive salaries being a drain on resources (which seems to be the Bachchan version being floated), another one thunder: "The overheads were 80 lakh and not Rs 2 crore a month; the total salary bill of ABCL was 3 per cent of sales; the percentage of employee turnover was one f the lowest when compared to industry standards. Plus in November '96, we were placed at Rs 105 per share with Reliance Capital. You mean to say, in four months we managed to screw up this bad?"

While awaiting confirmation that Somaiya has indeed jumped to the rescue, there are allegations that the Big B needs to clean up his act. "This is nothing short of a scam. Amitabh Bachchan has siphoned out the company and because he has to blame somebody, the executives are being made scapegoats. This is classic Amitabh Bachchan. He did the same with TV Asia UK, then with TV Asia USA and now with ABCL too," charges a former top notcher of ABCL, on condition of confidentiality.

Shareholders are fuming: "For the first time the corporate would was responding to the industry. I thought he knew what he was doing. Little did I know that a year down the line, I would be wondering where my money has gone." Creditors are bewildered: "They keep calling up for their payments," says and ABCL source. And a financial analyst notes: "Valuations in the entertainment industry are largely based on management perceptions. Frankly, for ABCL nobody will pay above Rs 10 per share."

While the company totters on its tow-year-old feet, Bachchan is apparently standing firmly on his. While T-Series chief Gulshan Kumar reiterates that the audio division tie-up with Big B is "purely for manufacturing and marketing", T-Series is learnt to have paid Bachchan a handsome cash advance and a 70.30 royalty deal. Over and above this, Bachchan has also signed several films outside of ABCL, ensuring his financial security. "But they may not be enough to help him tide over the forex he owes to the Saudi-based AI Baraka group who are holding Bachchan shares in mortgage," alleges an ex-ABCL executive who was privy to the company's finances.

Citing losses of Rs 50 crore from TV Asia USA and Reliance Silicon, the exasperated executive says: "There is no money coming into the company. IPCA shares have not been sold (IPCA is a pharmaceutical company that the Bachchans own and which they were planning to sell off to infuse some funds into ABCL). Instead loans have been taken against them to pay off the liabilities of TV Asia USA. Amitabh and Jaya Bachchan became 85 per cent owners of the company without putting in a paisa by over-valuing the one-hit Dekh Bhai Dekh wonder Saraswati (Saraswati Video was a television software company owned by Jaya Bachchan whose only success was the serial Dekh Bhai Dekh and which has been merged with ABCL at a price that would seem unreasonably high to most people). The swap ratio between ABCL shares and Saraswati shares was based on the claim that Amitabh's brand equity was worth Rs 15 core and Jaya Bachchan's was Rs 3 crore.

Finally, when there was a cash crunch, how could they have given a 20 per cent dividend to all their friends in the first year? If Bachchan had his way, we would be paying his telephone bills, his household expenses and for the car he wanted to buy."

Questions loom larger than the Big B's screen persona. Does the company owe Rs 4 crore in forex to the AI Baraka group? Did ABCL change its bank account in April without informing the shareholders? If the company did so, it's illegal because ABCL has working capital limits from Canara Bank and Allahabad Bank. And while the Bachchan is busy shooting in Australia for Major Saab, horror stories of termination notices being served at marriage pandals are pouring in.

Doubts of Amitabh Bachchan's brand equity being eroded if he becomes a minority shareholder are, however, being quelled. "Whether he remains as a shareholder or not is immaterial to the brand equity. His contract with ABCL (including among other things, Rs 3.5 crore for every film he does for ABCL) stays, as does Sunil Shetty's contract with Colgate Palmolive and Aamir Khan's advertising contract which are being done through ABCL."

But even as Karl Mehta, managing director of Cine Blitz and partner of Ketan Somaiya, insists that "Ketan is a sharp businessman and is looking for a majority stake in ABCL", insiders add that other NRIs have leapt into the fray, with scam-tainted stockbroker Bhupen Dalal's name figuring n the list too. The bottomline being that a bit of Bachchan is acceptable, that is, if he comes cheap. Former employees will vouch for the same. And while ABCL might finally wear the lean and mean look, Amitabh Bachchan may have trouble getting rid of his!