Three of the four Fortis board members questioned by shareholders resign

Three of the four directors of the Fortis board, whose ouster was demanded by a group of minority shareholders of the company, have resigned from their positions a day before their fate was to be decided in an extraordinary general meeting (EGM).

Harpal Singh, Sabina Vaisoha and Tejinder Shergill handed in their resignations over Sunday evening and Monday morning paving way for “fresh talent”. The fourth director, Brian Tempest, however, is still on the board.

The move comes more than a week after the Fortis board recommend selling a stake in the company to the Munjal-Burman duo. The other front-runners in the bidding process included the Manipal Group and Malaysia’s IHH Berhad.

“Having been privileged, and indeed proud, to have been part of building this great institution it is also the case that fresh thinking and fresh talent would add to the future potential of the company,” Singh said in his resignation letter.

Defending the Fortis board’s decision to recommend the bid made by the Munjal-Burman duo for a stake in the company, Singh said the bid was selected on criteria of certainty, simplicity of structure, no walk away rights, an early infusion of funds, capacity to address strategic needs and the ability to traverse a challenging landscape.

“Despite delivering a good outcome for the company and its shareholders, there still persist some less informed attempts to steer the board and the company into a situation that could be perilous for the company’s future,” Singh cautioned in his letter.

While five of the eight directors had voted in favour of Munjal-Burman, the remaining three preferred others. Vaisoha, in her resignation letter, said that since the shareholders had expressed the desire to bring in a new board, she welcomed their decision and was happy to step down with immediate effect. Shergill said he had joined the board to complete the quorum as several members had left it. Since there were enough members on the board now, he said he wanted to focus on his other commitments.

COMMENT NOW