Companies & Sectors
Economy & Nation Exclusive
Vote against Shriram Transport's share-swap, says advisory firm

According to a proxy advisory firm, the proposed share-swap between Shriram Transport Finance and Shriram Holdings is tilted in favour of shareholders of the latter and would lead in increasing promoter shareholding

Shriram Transport Finance Company (STFC) is proposing to approve a scheme of arrangement with Shriram Holdings (Madras) Pvt Ltd (SHMPL) with itself through a court-convened meeting of shareholders on 14 June 2012. However, a Bengaluru-based proxy advisory firm has recommended institutional investors to vote against the scheme, as it feels the share-swap is tilted in favour of SHMPL shareholders and would lead to an increase in promoter shareholding.

“As SHMPL’s sole business is its holding of STFC’s equity shares, the rationale of allotting over five lakh shares (STFC will allot 9.39 crore shares in place of 9.34 crore shares held by it SHMPL in STFC) is not disclosed by the company. At a closing price of Rs490.10 per share of STFC on 23rd May, the shares allotted in excess, have a market value of Rs24.54 crore,” the advisory firm said.

Genesis Indian Investment Company, ICICI Prudential Life Insurance Company, Ontario Teachers’ Pension Plan Board, Stichting Pensioenfonds ABP, Merrill Lynch Capital Markets Espana SASV, Equinox Partners LP and Fidelity Investment Trust are leading institutional investors in Shriram Transport Finance.

“Without any stated reason, the proposed share-swap is titled in favour of the shareholders of SHMPL.

We recommend shareholders vote against the amalgamation, as there is no rationale for allotting additional shares to the shareholders of SHMPL. While the amount itself may seem insignificant, it is the principle that is incorrectly applied and consequently leads to an increase in promoter holding without any basis,” the proxy advisory firm said.

On 27 April 2012, the Madras High Court had directed the company to call a meeting of its shareholders and creditors for considering and approving the scheme of arrangement between SHMPL and Shriram Transport Finance.

At 12.26pm on Friday, Shriram Transport shares were trading 3.5% down at Rs509 on the BSE, while the benchmark Sensex was marginally down at 16,082.



Nagesh Kini

5 years ago

The shareholding pattern being so skewed in favour of the promoters no shareholders esp. the minority can put up any opposition.
Even postal ballot won't do.
Strong shareholder awareness and stiff well oiled organized voting is the remedy.

CRISIL buys UK-based analytics firm Coalition for Rs250 crore

Coalition, which provides high-end analytics, mainly to leading global investment banks, reported revenues of 8 million pounds in 2011

Ratings agency CRISIL said it bought UK-based analytics firm Coalition Development Ltd in an all cash deal with a maximum payout of 29 million pounds or about Rs250 crore.

"The all-cash transaction has a maximum payout of 29 million pounds (around Rs.250 crore) with earn outs over two years, linked to achievement of specified milestones for the company's future revenues and profits. The acquisition will add to the earnings per share of CRISIL from the first year. The transaction is subject to regulatory approvals," CRISIL said in a release.

Coalition, which provides high-end analytics, mainly to leading global investment banks, reported revenues of 8 million pounds in 2011.

“Coalition’s cutting-edge analytical capabilities, in-depth understanding of the workings of financial markets and strong relationships with its clients will enable CRISIL Global Research & Analytics to widen service offerings, diversify its client base and deepen client relationships," said Roopa Kudva, managing director and CEO of CRISIL.

Coalition deploys unique proprietary analytics and algorithms to provide deep analytics on market size and dynamics, revenue opportunities and human capital. Coalition’s analytics provide a clear, actionable picture of the markets and are used by boards, strategy teams and top management at leading financial services institutions, CRISIL said in the release.


Newsviewer Exclusive
IPL to issue strict guidelines for franchise owners says Shukla

This year’s IPL was rocked by a spate of controversies involving franchise owners as well as players and the furores ranged from molestation charges against a player to a scuffle between a team owners and stadium authorities in Mumbai

New Delhi: Stung by the controversies and scandals this season, authorities at the Indian Premier League (IPL) will put in place strict guidelines for franchise owners to ensure that the glamorous event's brand image is not dented in future.

Although this year's IPL drew massive crowds, it was rocked by a spate of controversies involving franchise owners as well as players and the furores ranged from molestation charges against a player to a scuffle between a team owners and stadium authorities in Mumbai.

The league's boss Rajiv Shukla conceded that there were fears of brand IPL taking a hit due to the negative press but things seem to have settled down and he would ensure that there is no repeat by having a word with franchise owners.

"We are not going to protect any player. We will definitely take action against anyone found guilty and we will tell franchises also to be very careful about these things and that they should also keep a strict eye on the activities of the respective players and support staff of their side," Shukla told PTI in an interview.

"In IPL 5, the main focus was on the cricket. We were more concerned about the organisation of the game. When I took over as chairman my aim was to maintain the sanctity of the game. The focus was on the game," he asserted.

"I think the season was a major success because the game was successful. Whatever controversies erupted were not related to us. We haven't got any police agency to look into the cases."

Shukla said the IPL authorities are firm in dealing with any erring player and this has been conveyed to the franchises as well.

"Whenever anything is reported back to us by the police and we find that the players are guilty, we definitely take action," he said.

Asked whether the controversies dented the IPL's image, Shukla said, "Initially, people thought so but I don't think that any controversy had any adverse impact on the IPL because the kind of response we got from the people, showed that it had nothing to do with the IPL."

"Those were strictly confined to individuals. But even if tomorrow something comes to our knowledge, we will take strict action whether it is spot-fixing or anything else."

Shukla said any allegation has to be backed by evidence for the IPL to take action. "You don't know what is going on in an individual's mind. The day something comes to our knowledge, we will take strongest possible action on that. We are very prompt in taking action," he said.

"When spot-fixing was brought into our notice, we immediately suspended five players despite the fact that there was nothing against IPL 5. An inquiry is going on.

"In future, if something comes up, we will take strong action. BCCI is the only body in the world which has not pardoned its players who have been accused in fixing. As far as the rave party was concerned, that was a private party. IPL does not conduct any official party," he added referring to the spot-fixing sting operation by a TV channel and the detention of a couple of IPL players during a Mumbai rave party.

On Sports Minister Ajay Maken's suggestion that the BCCI should delink itself from the IPL, Shukla said, "IPL is a sub-committee of BCCI. IPL is a domestic league of BCCI. It cannot be segregated. IPL has grown because of the effort of the people in the BCCI and support of the cricket fans.


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