Kolkata, Sept. 1
THE M.P. Birla Group on Thursday forced a poll on all the seven resolutions proposed before the shareholders of the Pilani Investment and Industries Corporation Ltd at its annual general meeting.
Apart from the accounts, dividend, auditors' appointment and fixing of the directors' sitting fees, the resolutions were on the re-election of the K.K. Birla. B.K. Birla and G.D. Kothari.
The meeting was chaired by Mr P.K. Khaitan, legal counsel of the Birlas. He said the results would all go against the M.P. Birla Group.
"They are holding only 25 per cent. The Birlas, that is the B K Birla and K K Birla Group, are holding approximately 60 per cent. The rest is with the public," Mr Khaitan told reporters after the AGM.
Four senior officials of the M.P. Birla Group, including Mr R.K. Damani, Company Secretary of Birla Corporation, were present at the AGM. However, in the last year's AGM, none of the representatives of the MP Birla Group were present.
The late Priyamvada Birla also used to be a director of Pilani Investments, which holds a substantial stake in several Birla companies (including Century Textiles & Industries). After her demise, there is no representation of the MP Birla Group on the board of Pilani Investments.
When queried, Mr Khaitan said no proposal was received from the M.P. Birla Group for filling up of the Priyamvada Birla vacancy. According to the 2004-05 annual report of Pilani, the promoters stake has dropped to 58.6 per cent against 83.28 per cent shown in the previous year's annual report.
The M.P. Birla Group's stake is no longer considered as the promoters holding. "Under the norms of the Takeover Code, the promoters are supposed to disclose all their holdings in different companies. From last year, Pilani Investment is not receiving such a disclosure from the M.P. Birla Group. So, it ceases to be a promoter of this company," Mr Khaitan explained.
He ruled out an open offer from the B.K. Birla Group after buying out the stake held by the S.K. Birla and G.P. Birla groups but added that a report has been submitted to SEBI (Securities & Exchanges Board of India) for its opinion.
Members present in the meeting said that the representatives of the M.P. Birla Group raised a number of uneasy questions. They asked the board as to why Pilani Investment did not subscribe to the rights issue of Bihar Caustic and Chemicals Ltd.
"They also asked why two years ago Pilani Investments wrote off investments worth Rs 48.25 crore in Birla VXL and Saurashtra Chemicals Ltd. Both these companies belong to the S.K. Birla Group," sources said.