JOIN US The rift between Vijay Mallya loyalist shareholders and shareholders who want new management to take full control of the company’s operations came to the forefront at the Extraordinary General Meeting (EGM) of United Spirits, a subsidiary of Diageo.
The company had called for an EGM to ratify its proposal of reporting to the Board for Industrial and Financial Reconstruction (BIFR) of the fact that the accumulated losses of the company as on March 31, 2015, have resulted in erosion of more than fifty per cent of its peak net worth during the immediately preceding four financial years.
The EGM was chaired by D Sivanandan, Independent Director, United Spirits. While the Mallya loyalists demanded for cancelling of the resolution and abandoning of the EGM, the other faction called for voting to take place.
Mallya loyalists, though miniscule in number were quite vehement against what they called “non-transparent and irresponsible” approach of the new management towards the board.
They also demanded Mallya to chair the EGM, and questioned the credibility of Sanjeev Churiwala, CFO, United Spirits.
The company, in the proposal, among other measures, included financial restructuring of the company.
The proposal of the Extraordinary General Meeting was put forward by the board on December 22, last year. The proposal was put to the ballot at the end of the meeting.