The Satara-based United Western Bank (UWB) has moved two fresh petitions in the Company Law Board (CLB) under Sections 409 and 250 of the Companies Act seeking its intervention, as the bank fears that a change in the board of directors is likely to take place.
The move comes in the wake of Sicom, the state financial institution in Maharashtra, seeking to nominate four additional directors - S Jambunathan, Ramesh Venkat, P B Kulkarni and P C Shejwalkar - to the bank's board.
Sicom, which has a 9.91 per cent stake in the bank, already has two representatives - A K D Jadhav and Sharad Upasani - on the 11-member board.
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At the bank's annual general meeting (AGM) , which is going to see a power-struggle, to be held on August 23, a resolution will be considered to nominate/ re-elect seven directors - K R Chandratre, A S Sathe, G A Lele, M A Athavle, P P Kulkarni, A K D Jadhav and Sharad Upasani - to the board.
UWB's petition in the CLB in this regard is slated to come up for hearing on August 20.
"Effectively, Sicom, with less than 10 per cent stake, now wants to have six nominees on the bank's board. This virtually amounts to taking over the control of the management of the bank, for which compliance with Section 12 of the Securities and Exchange Board of India's takeover code is required. In this regard, Sicom has neither made a public offer nor made any public announcement," a senior official of the bank said.
UWB was in the eye of a storm when the Reserve Bank of India (RBI) asked the bank to recall the loan of over Rs 12 crore granted to an unregistered UWB Employees' Equity Trust.
The trust had bought over 24.32 lakh UWB shares, representing about 8.41 per cent of the bank's paid-up capital of Rs 29.88 crore.
The shares were purchased by the trust around December 2000 to ward off induction of nominees by Sicom and other group of shareholders.