Some minority shareholders of Schneider Electric President Systems, formerly APW President Systems, were today up in arms against the management for not listing the company on national stock exchanges and alleged it does not want to comply with the stricter disclosure norms.
They also alleged that the promoters are offering to buy back shares at seemingly lower valuations, leaving investors with few choices.
After listening to the grievances of the shareholders, company chairman Shravan Sharma, who is also an independent director, said the management will look into the matter and come back to them soon.
At the company's shareholder meeting here, minority investors expressed displeasure over company offering Rs 200 a share as the exit price, saying the price does not take into account its improving financial performance.
Schneider Electric President Systems is a leading designer, manufacturer and supplier of standard and customised enclosure systems in India.
Schneider Electric South East Asia (HQ) Pte Ltd is the promoter, holding 75 per cent of the shares. The company is listed on the Bangalore SE and Pune SE.
Raising the issue at the company's AGM at Attibele, near here today, one shareholder Kapil Chopra alleged that the promoters are offering to buy back shares at seemingly lower valuations by intentionally not listing the company with the national stock exchange including MSEI, where even small companies have been listed.
"I bought a couple of thousands shares five years back at an average of Rs 195 per share. Now, the company is offering us Rs 200 to tender our shares," Ashish Chug, another shareholder, said.
In 2011, Schneider Electric South East Asia (HQ) Pte Ltd acquired 55 per cent of the share capital from the promoters and up to 20 per cent from public shareholders, offering Rs 195 per share, Chopra said.
Subsequently, a delisting offer was made in December 14, 2012, at Rs 195 a share, but of the 15.12 lakh shares, only 6.79 lakh shares were tendered in the delisting offer. Of this, only 3.81 lakh shares were tendered at or below the discovered price of Rs. 250 a share.
"Hence, the delisting offer - which requires 90 per cent of the public shareholding to consent to the proposal for delisting - failed," Chopra said.
Countering company director Sugata Sircar's remark of not being aware that MSEI is a national stock exchange, Chopra said, "This is an unbelievable statement coming from Director's mouth that he is unaware that the company could be listed in MSEI while many companies have been listed there."
Sircar, in reply, had mentioned that he was not aware of the fact that MSEI is a national stock exchange.
Manoj Dua, another shareholder, said as many as 80 per cent of the shareholders do not want to tender shares which reflects the enormity of their disappointment with the intent of the company.
Sridhar, another shareholder, alleged that the company management is bringing "bad repute" on to the parent company by throwing to the wind the standards of corporate governance.
"The management has not adequately informed independent directors Shravan Sharma and V S Vasudevan on matters of delisting of the company with the national stock exchange," he said.
Sridhar also questioned why the company removed immediately from the website valuation of the company to determine the buyback price which was uploaded in December. "This is another instance of fallen corporate governance," he said.
Manish Somani, another shareholder, argued that net sales of the company grew 63 per cent year on year in the December quarter. The EPS was Rs 8.4 per share for the December quarter alone.
"If the stock was listed, it could easily have traded at Rs 450-500. All this time the management assured us that they were in the process of listing. The exit offer at such low a price, has come as a rude shock to investors.
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