On Friday morning, Gautam Singhania, Chairman and Managing Director of textile major Raymond Ltd, asked minority shareholders of his company to vote against a resolution on selling four luxury apartments owned by the company to members of the promoter family.
A few hours later, shareholder advisory firm IiAS, which criticised the resolution, said Singhania was trying to dissociate himself from the proposed sale, and was abdicating his responsibility in decisions taken in the past under his chairmanship.
Singhania’s letter to shareholders and IiAS’s response is the latest in a long line of letters and counter-letters regarding the sale of four duplex apartments in JK House, in the south Mumbai neighbourhood of Breach Candy, to the promoters of Raymond Ltd.
The sale, if it goes through, will lead to an opportunity loss of ₹650 crore, an earlier report by IiAS said. The advisory had asked minority shareholders to vote against the resolution proposing the sale of the premium real estate at the company’s AGM, on June 5.
Decisions a decade old
In its newest report, IiAS said the transactions relating to the signing of the contentious tripartite agreement to sell apartments at throwaway rates to promoters — including Gautam Singhania — were undertaken in November 2007.
The decisions to sign these agreements were made in two board meetings — held on June 23, 2006 and July 20, 2007. Singhania was the company’s chairperson and managing director back then as well. He was also a party to the agreements.
‘Best in class governance’
In his letter to shareholders, Singhania, however, maintained that he is “keeping in mind the best in class corporate governance”.
“It is unfortunate,” he added, “that certain vested interests are projecting a completely wrong perspective that the company is seeking to transfer this property to family members at low prices and trying to project this in a sensational manner, which is completely wrong. In addition to this, several personal allegations are being made towards me, which are completely baseless.”