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Biksham Gujja, Chairmam of SKS Trust, says it is a straightforward request that a 12.6 percent shareholder needs to get a board seat and he fails to see the objections to it. He has not yet received any formal response on nominating Vikram Akula on the board.
One of my Trust’s board member is an SC advocate, we have a legal team, but would like to avoid all that because it will hurt borrowers, share value. But I would like to enter into a dialogue.
SKS Trust, one of the bigger shareholders in SKS Microfinance , pushing for Vikram Akula's nomination to the board, is yet to hear a formal response. Akula was the founder of the microfiance company who had quit under pressure and the company is opposed to offering him a board seat. Biksham Gujja, Chairmam of SKS Trust says it is a very straightforward request that a 12.6 percent shareholder needs to get a board seat. He fails to understand the objections
Though he is still expecting a formal reply, he is not opposed to taking all the actions necessary to get its rights back, including the legal route.
Below is the verbatim transcript of Biksham Gujja's interview on CNBC-TV18
Q: If you can tell us the facts as of now, have you made a formal request that Vikram Akula should represent SKS Trust. What has been the board’s response?
A: I wrote a letter to SKS board nominating Vikram Akula who started SKS, who also started SKS Trust, to be our representative when we reached 12.6 percent of the SKS Microfinance; we are the largest shareholders of the company. I have not got a formal response to that simple and polite request. Instead, there were several media reports wherin questions were raised on unrelated matters. The objections were not factually correct either, like SKS Trust not being governed properly or no shareholder is eligible to nominate (implying) Vikram Akula is not accepted.
I am reading all these in the media, but we have not received any formal reply for a very simple straightforward request from the trust which is the largest shareholder today, to get a board seat and then my nomination of Vikram Akula to the board of the SKS.
Q: If they continue with the silence, what will be your next step?
A: We are exploring all our options and I want them to communicate to me as to what their concerns are. Vikram Akula had started SKS. I am not able to see what the objections are, instead of it they are saying that the Trust is not managed properly.
We are shareholders of the SKS, they are not our shareholders. If they have concerns about it, certainly they can come out and openly debate and discuss but these are not related ones. An extremely simple request, very straightforward that 12.6 percent shareholder needs to get a board seat and there are number of board members with much less shareholding. It is certainly a convention to have a largest shareholder represented in the board.
SKS Microfin stock price
On April 23, 2014, SKS Microfinance closed at Rs 262.40, down Rs 12.65, or 4.6 percent. The 52-week high of the share was Rs 282.40 and the 52-week low was Rs 95.60.
The company's trailing 12-month (TTM) EPS was at Rs 4.20 per share as per the quarter ended September 2013. The stock's price-to-earnings (P/E) ratio was 62.48. The latest book value of the company is Rs 36.08 per share. At current value, the price-to-book value of the company is 7.27.
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