HC clears Philips’ sale of WB unit

In a press release, Philips said that the bench had ruled that “the company is free to sell its undertakings with the consent of the shareholders as required under Section 293 (1) (A) of the Companies Act.”

The Philips employees and employee-shareholders who had opposed the sale of the factory, which makes colour televisions, said they will now move the Supreme Court.

On September 30 last year, Philips had sealed an agreement with Videocon to sell the Salt Lake factory for Rs 9 crore. It had called for an extraordinary general meeting of shareholders on December 4 to gettheir approval.

The sale was opposed in court by the Pieco Workers Union and some shareholder-employees, who alleged that the company had undervalued the unit and that the EGM notice was “tricky.”

At the EGM, a poll on the resolution was forced by the financial institutions — Life Insurance Corp of India, General Insurance Corp and Unit Trust of India — which together hold a 20.88 per cent stake in Philips.

The Philips’ press release said the division bench stated that “how the price of Rs 9 crore was arrived at is the matter of general administration” and added that “it was not necessary to be set out in the explanatory statement.”

According to Philips, Justice Sujit Kumar Sinha’s verdict was also criticised by the division bench. “The court held that in support of the contention that the said price was unrealistic or grossly under valued, no material was placed before the Hon’ble Trial Court which could lead to such a conclusion,” the release said.

The division bench also added thatnotice to the EGM was “not tricky,” according to the release.

McDowell mulls overseas listing

CHENNAI: McDowell and Co Ltd, flagship of United Breweries’ (UB) spirit division will soon be listed overseas. For this, the company is adopting the US general accepted accounting practice (GAAP), Vijay Mallya, chairman, McDowell said here today.

“We are looking at overseas listing mainly to increase shareholder value,” he added. Apart from this, McDowell has also embarked on a re-engineering process. In the next two years, it proposes to invest Rs 35 crore to improve yield and reduce wastage. It is planning to spend around Rs 40-50 crore on advertising and marketing and Rs 25 crore on capital expenditure this year, Mallya said at a press briefing following the annual general meeting.

The company is keen on overseas acquisitions, he said. However, the acquisition should compliment the overall business strategy of the company. McDowell is also planning to slowdown on contracts and improvemanufacturing units.

Several foreign companies have evinced interest in picking up equity in the company, but McDowell is also looking at multiplicity of value addition through such a tie-up, said Mallya.