Madhu Mehta - the Loss of an Extraordinary Righteous and Caring Human Being
October 22, 09The tragic and untimely passing of Mahendra Mafatlal “Madhu” Mehta of Jayam Manufacturing deeply shocked his family, friends and business associates around the world. Together with his late father and brothers, Madhu built one of the diamond world’s greatest empires.
This kind and modest man never lost sight of his priorities; the love and care of family came before anything else. And if that impacted the business, so be it. When, after the funeral, I had a chance to express my condolences to Madhu’s son, Mihir, I finished the conversation by cautiously asking if it was still appropriate to wish him a Happy Diwali – a Happy New Year. Mihir answered in the affirmative. “Chaim, life is a continuous cycle – and we always must look forward with hope and believe that the future will bring good things. Father passed away in the final hours of the last year. There is considerable symbolism in this. Yes, you may say Happy New year.”
These words from a scion of a great family made me delve into their history. Madhu was a pure, golden link in a long chain of a great diamond factory. The founder of the business was Madhu’s late grandfather, Mohanlal Mehta, who around 1900 started a business to serve the needs of the local jewelry trade in what was then called Bombay. The name of the business was Mohanlal Raichand & Sons (“Mohanlal Raichand”). Mohanlal Mehta had two sons, who both joined the business. The younger son, the late Mafatial, was Madhu’s father, who joined the business at about 1932.
Well before World War II, and during the Great Depression, Mohanlal Raichand successfully developed connections in South Africa and Antwerp. This was long before the take-off of the Indian diamond manufacturing sector. In 1948, shortly after World War II, when the Central Selling Organisation (CSO) needed to rebuild its client list that had been severely affect by the war, Mohanlal Raichand became a client of De Beers.
The Mehta family is rightfully being credited with having laid the roots of the modern Indian polishing industry by employing Flemish polishing experts from Antwerp to teach local craftsmen in India. In 1960, when Madhu was attending college in Bombay, the family decided to leave India and moved to Antwerp. Madhu joined the business and in that same year Jayam was established, one of the first Indian companies to open its doors in Antwerp.
Madhu Mehta
According to various records, Jayam was originally a buyer of rough diamonds for the fledgling Indian diamond manufacturing industry. It also traded in both Belgian and Indian polished diamonds. Unlike Mohanlal Raichand, Jayam originally had no contact with De Beers and simply purchased rough diamonds in Antwerp and exported them to India. To assist in the development of the family business, and to take advantage of opportunities in India, a company called Samir Diamonds was established in Bombay in 1962. It was run by two of Madhu’s brothers, Kavasbhai and Nanubhai, and became part of the family business.
The skills of father and sons soon became legendary. Jayam had become the biggest diamond company in Antwerp in just a decade, and in 1974, it became a CSO Sightholder. Initially, the quantities of diamonds that Jayam purchased directly from the CSO were relatively small, but De Beers continued to supply Jayam with large quantities of diamonds through Diamdel.
In 1975, one of Madhu’s brothers, the late Jitubhai, opened a New York City office of the family business, which soon became the largest seller of Indian polished diamonds in the U.S. market. In the late 1970s, Jayam diversified and became a manufacturer of better-quality diamonds.
By 1978, Jayam opened a modern factory in Belgium’s Kempen, which was quite a tribute to the Belgian diamond community, which had provided such a phenomenal trading platform to the company. During the crisis of the 1980s, when the traditional diamond centers were greatly impacted by the high inflation, high debts and economic recession, Madhu (and the other Indian manufacturers) continued to do reasonably well because his business specialized in smaller near-gem (affordable) goods.
In Israel, in the mid-1980s, the Israeli government pleaded with De Beers to appoint an additional dealer for the Israeli market. Reviewing all the options, De Beers decided to ask Madhu to become the next Israeli dealer. He did.
At the top of his professional career, Madhu was the world’s single largest client of De Beers – and we are talking about the days in which the CSO was still marketing 80 percent of the world’s rough production. It has been calculated that over a period of more than 30 years, starting in 1974, De Beers alone supplied him with $2.5 billion worth of rough. (Between 1986 and 1989 Jayam’s DTC Sights exceeded $200 million per annum, reaching a peak of $280 million in 1988.) Hundreds of thousands of cutters, traders, manufacturers, jewelers and retailers were at one time or another dependent on Madhu’s rough distribution skills, his fairness and sound judgment.
When around 1988 De Beers targeted Thailand as the next great place to manufacture diamonds, Madhu erected the largest state-of-the-art factory in Bangkok employing well over 1,000 workers – its opening was attended by two generations of the Oppenheimer Family. It also led to the closing of the Antwerp factory.
Around 1997, Mehta family problems (not related to business) required Madhu’s personal attention, which came at the expense of the company performance. The almost one century- old family business faced a temporary decline, a situation which Madhu was sure would reverse itself as soon as he could concentrate again on business. Sure enough, in 1999, the business revived and Madhu was convinced that within a few years the company would again match its previous glory. However, it was not to be. The introduction of Supplier of Choice was, for Jayam at least, the beginning of the end of a long relationship with De Beers.
Everyone who now reflects about this great man and his contribution to the diamond community may, in one’s own mind, see different aspects of this unique human being’s history. The overriding thoughts that haven’t left me since learning that Madhu would not recover from the coma he fell into after what had been considered a successful by-pass surgery, was the sense of betrayal that Madhu sensed regarding De Beers. The history of the Mehta family underscores the centrality of De Beers in the company’s operations – and, one might have thought, Jayam was also central for the diamond supplier’s distribution policies.
Jayam lost its DTC Sight – the heart of its operations – in the wake of a series of challenges on the fairness of the application of Supplier of Choice. Going by the new system’s rules, Madhu aired his complaints with the DTC Ombudsman. Several times, the Ombudsman ruled in his favor. These rulings were ignored, or, more precisely, no remedial actions were taken by the DTC. He was forced to go to court in London – where he lost. Irrespective of whether the court erred or not, to Madhu and his family the judgment was an enormous blow, a disappointment, a betrayal. He could hardly believe it.
To end a well-over-30-year relationship with De Beers in such an acrimonious manner pained Madhu deeply. The system had betrayed him, which deeply affected him – his heart was broken long before it gave away last week. Despite the circumstances, Madhu had always spoken in the most affectionate ways about his friends at De Beer. It was the system that failed him – and the timing of the introduction of Supplier of Choice was not in his company’s favor.
What kept Madhu Mehta going was the strong knowledge that he was doing the right thing – all the time. During his lifetime, he showed enormous courage, backed by strong moral principles. His passing away was truly untimely. There was still so much to do for Madhu – and he had been so determined.
To me, Mihir’s words, that one may still say “Happy Diwali,” shows that the next Mehta generation is imbibed with Madhu’s perennial optimism, drive and forward-looking attitude. Madhu will be missed by us all – but his enormous contribution to the Indian, Israeli, Belgian and – actually – to the global diamond world will be etched in all our collective memories. Our thoughts are with his wife, Purnima Mahendra, the Mehta family and loved ones.