RIL Board rejects objections raised by Anil Ambani
Wednesday, April 27 2005 18:22 Hrs (IST) - World Time - 
Mumbai:
Siding with Reliance group chairman Mukesh Ambani, the Board of the flagship company RIL today (Apr 27, 2005) rejected objections raised by his younger brother and Vice Chairman Anil on financial accounts, appointment of directors and demand for termination of the ongoing buyback of shares.
Immediately after the Board meeting, the company informed the stock exchanges that "while all other directors approved and signed the accounts at the meeting of the Board of Directors, Anil Ambani abstained from voting on the audited financial accounts and has not signed the same."
Spotlight: Battle of Ambanis
In its communication, the company further said "all other Directors approved the re-appointment of H S Kohli and appointment of Ashok Misra. Anil Ambani dissented to the reappointment of Kohli and appointment of Misra to the Board. The reappointment of H R Meswani was unanimous."
Informed sources said the Board also turned down the suggestions of the younger Ambani, engaged in a battle with brother Mukesh over the control of Reliance empire, for "immediate termination" of the current buyback offer saying it was "inappropriate".
While the Board passed over two dozen resolutions, including the report of its Corporate Governance Committee, Anil was not supported on any of the issues raised by him by any Director of the 11-member Board.
Listing out a series of reasons for termination of the buyback programme, approved by RIL Board at its meeting on December 27 with a provision of Rs 2990 crore, Anil said despite the three-month old programme, RIL stock under-performed the BSE index by 6 per cent since November.
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Fighting a lone battle at the Board, which he had earlier described as Reliance 11 Vs him, Anil declined to sign the accounts "owing to the absence of relevant details and disclosure on major issues, including related party transactions, asset disposals etc."
He opposed appointment of Misra as an Independent Director on the ground that there was "no prior consultation or discussion" and reappointment of Kohli for he being over 70 years of age.
But the major issue raised by him related to his opposition to buyback of shares. "The company has not seriously pursued the buyback. Despite the fact that out of 83 days since the buyback being operative, the stock price has remained below the buyback price of Rs 570 per share for 72 days," he said.
Even before the buyback was approved at the December Board meeting, Anil had publicly questioned the move while alleging insider trading and said there was more than what met the eye on the issue.
While RIL approved the programme with the stated objective of stabilising its share prices, that witnessed wide fluctuation in the face of the fight between the two brothers, Anil said so far only Rs 150 crore of the approved amount of Rs 2990 crore was used.
The issue has been raised at a time when the process of valuation of RIL and other group companies as part of the negotiations for a settlement between the two brothers is on.
In case RIL share prices are lower, it would benefit the brother who gets the company as part of the settlement, market sources said.
PTI
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