Birla Corp's minority shareholders move CLB

Petition by minority shareholders to come up for hearing before the bench tomorrow.

Minority shareholders of Birla Corporation, the M P Birla group flagship, today filed an application with the Company Law Board (CLB) claiming mismanagement, ahead of the company's annual general meeting on September 15.

The petition is likely to come up for hearing at the CLB's principal Bench tomorrow. Shareholders have asked for a freeze on the voting rights of the promoter group companies, an injunction on the sale of assets of Birla Corporation and a stay on the re-appointment of RS Lodha as director of Birla Corporation.

Under the existing regulations, the petition would be accepted by the CLB only if it has the signed consent of 100 shareholders or is moved by shareholders owning a tenth of Birla Corp's share capital .

The second eventuality is unlikely, as the shareholding pattern of Birla Corporation as on June 30 indicates that public holding in the company is only 8.87 per cent.

While institutional investors hold 23.01 per cent, the promoters have a 64.28 per cent stake.

Apart from mismanagement, the grounds on which the application was filed were oppression of the rights of minority shareholders and suppression of facts.