The Hindu Business Line : ‘Emami looking forward to partnering Zandu’s existing promoters’

Kolkata, Aug. 25 The Company Law Board is expected to pronounce an interim order on the standoff between the Zandu Pharmaceutical Works and Emami Ltd after Emami and its associates bought out the Vaidyas, one of the two promoter groups of Zandu.

Senior officials of the company told this to Business Line after the 25th AGM of Emami here today.

Mr H.V. Agarwal, Executive Director of Emami, however, said that channels of communication with the promoter group was open and Emami still maintained that it was looking forward to partnering with the existing promoters of Zandu for the growth of the company.

Emami officials were guarded in avoiding specific questions from shareholders, as the matter was sub-judice. Even the statement of the joint promoters of Emami, Mr R.S. Agarwal and Mr R.S. Goenka, in the balance sheet, was less than matter of fact on the issue.

“In May 2008, we acquired a substantial stake in the Zandu Pharmaceutical Works Ltd, the respected ayurvedic and health product company having brands like Zandu Balm (45 per cent market share), Zandu Special Chayawanprash, Kesri Jeevan (10 per cent market share), various other ayruvedic and ethical products, strong marketing research and operating efficiencies”.

Out of the Emami’s current holding of 27.9 per cent stake in Zandu, a significant portion is still in physical form and has not been transferred to the Emami group after they were purchased from Vaidyas.

The Mumbai High Court has postponed the AGM of Zandu and referred the dispute back to the CLB for settlement.

The mandatory open offer for 20 per cent additional stake purchase also hangs fire, as the SEBI is yet to clear it.

At the AGM, minority shareholders expressed their concern regarding delay in formalisation of the buy-out.