Fortis shareholders overwhelmingly support removal of pro-establishment board directors

The EGM was called by Fortis minority shareholders East Bridge Capital and Jupiter India Fund in April to remove the directors on an allegation that the Board failed to be fair to all shareholders

May 23, 2018 / 04:25 PM IST

Fortis Healthcare on Wednesday announced that its shareholders, during the extraordinary general meeting (EGM), have passed resolutions seeking removal of four directors and ratified appointment of three board members recommended by minority shareholders on the board.

Out of seven resolutions moved at the EGM held on Tuesday, shareholders took up four resolutions for voting pertaining to removal of independent director Brian Tempest and ratifying the three directors — Suvalaxmi Chakraborty, Ravi Rajagopal and Indrajit Banerjee — nominated by minority shareholders East Bridge Capital and Jupiter India Fund.

The EGM was called by Fortis minority shareholders East Bridge Capital and Jupiter India Fund in April to remove the directors on an allegation that the Board failed to be fair to all shareholders.

Shareholders didn't take up voting on removal of Harpal Singh, Sabina Vaisoha and Tejinder Shergill as resolutions for their removal

become "infructuous" with their resignations prior to the date of the meeting of EGM.

Around 3.84 million votes polled 87.91 percent in favour removing Tempest, while 98.82 percent voted to ratify the appointments of Chakraborty, Rajagopal and Banerjee as independent directors on the board.

Close

The EGM assumed significance as it decisively changed the composition of the board that backed Munjal-Burmans offer.

With three independent directors who voted against the offer now taking control of the board, there is much likelihood of a revisit of the entire bidding process including allowing bidders to do due diligence, which was rejected by the previous citing further delay in clinching a deal.

Moneycontrol earlier reported that leading shareholder Yes Bank is backing the resolutions moved by the East Bridge Capital and Jupiter India.

Yes Bank, the leading shareholder, holds 15.14 percent stake in Fortis while East Bridge Capital and Jupiter India together hold around 12 percent stake.

Early this month, Manipal-TPG consortium got back into the race making a revised offer for Fortis Healthcare, valuing the company at Rs 8,358 crore, or Rs 160 per share, and said it will invest Rs 2,100 crore upfront in the healthcare services provider as a part of the deal. IHH Healthcare that offered to invest Rs 4000 crore valuing Fortis at Rs 175 per share also said it's still committed to Fortis and is in touch with shareholders.

Shares of Fortis dropped 0.17 percent and were trading at Rs144.80 on BSE, the benchmark Sensex declined 0.63 percent to 34,431.66 points.
Viswanath Pilla is a business journalist with 14 years of reporting experience. Based in Mumbai, Pilla covers pharma, healthcare and infrastructure sectors for Moneycontrol.
first published: May 23, 2018 04:25 pm

stay updated

Get Daily News on your Browser
Sections