Kolkata: The Bombay high court on Thursday passed an order adjourning the annual general meeting of Zandu Pharmaceutical Works Ltd, which was scheduled to take place in Mumbai on Saturday.
The court was hearing a petition filed by the management of the herbal health care company, which is trying to stave off a hostile takeover by Kolkata-based fast moving consumer goods company Emami Ltd.
Stake dispute: Emami Ltd’s headquarters in Kolkata
“Our annual general meeting (AGM) has been postponed,” Zandu’s managing director Girish Parikh said. “We haven’t yet received the signed copy of the Bombay high court order. Once we receive it, we’ll decide our future course of action.”
The Parikh family had moved the high court arguing that they had right of first refusal in respect of the 24% stake that the Vaidyas—erstwhile co-promoters of the firm—sold to Emami. Because it is disputing the transaction, Zandu hasn’t registered Emami as the owner of the shares in its books. Had all the shares been registered in its name, Emami would have had a 27.5% stake in the company.
Emami told the court on Thursday that it had not received the notice for Zandu’s AGM, and that the Mumbai-based company was planning to induct five new directors on its board without issuing requisite notice to shareholders. Two independent directors were also supposed to seek the shareholders’ approval for reappointment at the AGM.
Parikh denied that the court adjourned the AGM because Zandu didn’t send a notice to Emami.
Zandu had earlier moved the Securities and Exchange Board of India and the Company Law Board (CLB), disputing the acquisition of shares by Emami. Though CLB had earlier refused to hear Zandu’s petition, it might now have to. The Bombay high court ordered Zandu to approach the CLB again.