Financial Daily from THE HINDU group of publications
Tuesday, Sep 30, 2003
Financial Daily from THE HINDU group of publications Tuesday, Sep 30, 2003 |
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Info-Tech
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Courts/Legal Issues Court restrains Online Media MD from removing directors Our Bureau
Hyderabad , Sept. 29 THE Chief Judge of the City Civil Courts, Hyderabad, on Friday restrained the Managing Director of Online Media Solutions Ltd (OMSL), Mr K. Srinivasa Rao, from removing two directors — Mr Rama Srinivas and Mr P.V. Narasimha Rao — from the board and instructed him not to initiate any resolution at the annual general meeting of the company scheduled for Tuesday. The MD had issued a notice in the newspapers Tuesday last intimating the members on a resolution: proposing the removal of the two directors from the board which would be placed for shareholders approval at the AGM slated for September 30. Challenging this, the two directors submitted to the court that though they had entered into a share purchase agreement with the MD for acquiring 34 lakh equity shares, equivalent to 33 per cent of OMSL voting rights and also paid over 2/3rd of the sale consideration, the shares were not transferred in their favour and the matter was pending before the court. The acquirers said they had already paid a consideration of Rs 45 lakh of the agreed amount of Rs 70.72 lakh for acquiring the 34 lakh shares and were also ready to pay the balance. The alleged that the MD had breached the contract by not transferring the shares in favour of the acquirers to enable them to perform the statutory requirements for open offer to the shareholders; he was instead trying to sell the shares to another party. The acquirers had approached the court and obtained orders against transfer of those shares by the OMSL MD in favour of any other party. Admitting that he had entered into an agreement with the acquirers for selling 34-lakh shares held by him, Mr Srinivasa Rao, refuted the allegation that he had entered into a different pact for a better price. He sought the dispute to be resolved through arbitration.
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