After the Sandoz Minority Shareholders Association scored a victory by getting a valuer appointed in the case of the Hindustan Ciba-Geigy and Sandoz merger, a minority shareholder of Hindustan Ciba-Geigy has approached the Mumbai high court seeking a stay on the de-merger of Hindustan Ciba-Geigys speciality chemicals business.
The minority shareholder of Hindustan Ciba- Geigy, Dinesh V Lakhani, has moved the Mumbai high court for a stay on its earlier order approving the de-merger of Hindustan Ciba-Geigys speciality chemicals business.
Lakhani, has served notices on both Hindustan Ciba-Geigy and the advocate Crawford Bayley & Co. The petition, requesting the court to grant a stay, is coming up for hearing today.
Hind Cibas speciality chemicals business is being spun off into a separate company, to be called Ciba Speciality Chemicals (India) Ltd.
According to the scheme of arrangement, each Hindustan Ciba-Geigy shareholder will get one share in Ciba Speciality for every two shares held by them in the former.
Lakhani had objected to the scheme, saying that Hindustan Ciba-Geigy shareholders should get shares in the new company in the proportion of 1:1.
The Bombay High Court had, in its order passed on July 25, rejected Lakhanis objections and approved the scheme of the de-merger.
Lakhani says he is waiting for a copy of the order as he was not informed of the grounds on which his petition was dismissed and that he is seeking a stay till the time he files an appeal to a division bench.
At the extra-ordinary general meeting of the company held on December 10, Lakhani had moved an amendment for modifying the proportion of shares offered to the Hindustan
Ciba-Geigy shareholders to a 1:1 ratio.
However, the amendment had been ruled out of order by the chairman and the de-merger resolution was passed without any modification.
Giving reasons for his objection to the ratio for the de-merger, he cited the case of Sandoz which, while hiving off its speciality chemicals business, has given its shareholders shares in the proportion of 1:1 in the new company, Clariant (India) Ltd.
Hindustan Ciba-Geigy sources said that the amendment was not taken up as almost all shareholders were in favour of the scheme of the de-merger.
In his submission to the court, Lakhani said if an amendment is refused, all subsequent proceedings as regards to that particular question are invalidated.
