The Hindu Business Line : Ruia Group plans revamp of Dunlop, Falcon Tyres boards

THE Ruia Group, which acquired Dunlop India Ltd (74.5 per cent) and Falcon Tyres Ltd (68 per cent) in November, is planning to go for a board recast in both the companies in February. Though the nominees of the erstwhile Dubai-based promoter, Jumbo Group, had already resigned from the respective boards, no fresh appointment has taken place after the takeover.

Earlier, the Ruia Group, through its special purpose vehicle Wealth Sea Pte Ltd (Singapore), had taken over the controlling stake of Jumbo World Holdings Ltd in DIL Rim and Wheel (DILRW), Mauritius.

DILRW holds a controlling stake in Dunlop and Falcon. The Rs 200-crore deal was struck in end November.

The new management in Dunlop and Falcon has informed the BSE that they have decided to seek shareholders' nod through a "special resolution for the proposed indirect acquisition and change in control of the company," in accordance with regulation 12 of the SEBI takeover code, 1997, through postal ballots.

Mr Ajit Kumar Sengupta (former judge of the Calcutta High Court) and Mr Gopinath M.R., a practicing Company Secretary, have been appointed as scrutiniser in Dunlop and Falcon respectively for conducting the postal ballot process.

The results will be announced at the extra-ordinary general meeting of Dunlop convened on January 25. The EGM of Falcon Tyres is scheduled to be held on January 30.

"We will go for a board restructuring if we get shareholders' okay to the special resolutions in both the companies," Mr Pawan Ruia, Chairman of Ruia Group, told Business Line.

Shareholders' complaint: Meanwhile, a number of shareholders of Falcon Tyres have reportedly approached the SEBI, opposing the company's move to seek shareholders' approval to the special resolution.

Challenging the move, Mr Arun Goenka, from Mumbai has alleged that Hindustan Dorr Oliver Ltd (HDOL), another formerly Jumbo Group company, having similar shareholding pattern, and which also changed hands recently, had already gone for an open offer.

It was also alleged that the Ruia Group did not announce respective acquisition costs of the two companies to avoid open offer.

"The acquisition of DIL Rim and Wheel was actually targeted at acquiring control over Dunlop and Falcon and cannot be termed as indirect," Mr Goenka argued.

When contacted, Mr Ruia reiterated his stand that the acquisition conformed to Regulation 12 of the SEBI takeover code and need not go for an open offer if the special resolution is passed by the shareholders. "It is an indirect acquisition and we have paid a price for acquiring control of DIL Rim and Wheels," he said.