Hirco shareholders reject Laxey’s board revamp proposal1 min read . Updated: 06 May 2009, 10:39 PM IST
Hirco shareholders reject Laxey’s board revamp proposal
Bangalore: London-listed Hirco Plc.’s shareholders on Wednesday rejected a move by hedge fund Laxey Partners Ltd to remove its chairman and two board members at an extraordinary general meeting.
Shares of Hirco, the investment vehicle for India’s residential builder Hiranandani Group, rose 8.5% after the news.
“As a board, we considered the Laxey proposals ran directly against the interests of the company," Douglas Gardner, Hirco’s independent non-executive director, said.
Laxey, which holds about 10% of India-focused Hirco, had called for a shareholder meeting to remove Hirco’s chairman, Niranjan Hiranandani, and two other directors. It had also sought to appoint its nominees to Hirco’s board.
Laxey, which had been opposing Hirco’s proposed merger with its holding companies Hirco Developments Pvt. Ltd and Hiranandani Investment Co., had also urged Hirco’s directors to consider naming a new chairman independent of the Hiranandani family.
Last month, Hirco said 13.73% shareholder Standard Life Investments Ltd was not in favour of Laxey’s proposals to revamp Hirco’s board. Hirco had also said last month the replacement of its chairman would affect its property sales and urged its shareholders to reject Laxey’s move.
Proxy advisory firm RiskMetrics Group Inc. had also recommended that Hirco shareholders vote against Laxey’s proposals.
“Laxey has done a large damage to the company’s image. We have to work on that," Hiranandani said, adding that the company would continue to work on the ongoing projects.
Asked whether Laxey Partners would now exit from Hirco, Hiranandani said: “We are not worried about who are the shareholders. We have nothing against Laxey Partners as well. Our aim would be to create shareholders’ value."
PTI contributed to this story.