IPCL: Amitabh Jhunjhunwala joins issue

In the RCL board meeting held today to consider the financial results for FY05, the board of directors passed the accounts “noting” the dissent of Jhunjhunwala made only with respect to a disinvestment of entire holding of 50 per cent in Reliance Petroinvestments Ltd during 2004-05, the company informed the stock exchanges here. The board also comprises Anand Jain, a bete noire of Anil Ambani.

In a late evening statement, RCL clarified that that it had invested Rs 4.44 crore in the equity of Reliance Petroinvestments Ltd. ‘‘RIL, through its wholly-owned subsidiary, had also invested Rs 4.44 crore in the equity of Reliance Petroinvestments Ltd,’’ a RCL spokesperson said.

The statement said Reliance Petroinvestments invested Rs 2,639 crore to buy 11.2 crore shares of IPCL at Rs 231 per share. RPL had borrowed Rs 2,579 crore from RIL.

‘‘The net asset value of Reliance Petroinvestments Ltd share was less than its par value since it had invested in the shares of IPCL at Rs 231 per share against the present market value of Rs 160 per share,’’ the statement said.

“Reliance Capital, therefore, decided to sell these shares at par to companies, Reliance Pharmaceuticals Pvt Ltd and Reliance Nutraceutical Pvt Ltd, whose ultimate economic benefit accrues to RIL,” the statement said. “RCL shareholders therefore have not lost in this transaction,’’ it said.

‘‘The loss in the consolidated accounts of Rs 87.1 crore was on account of the reversal of the profits earlier reflected in the consolidated accounts in the previous two years. It does not affect the stand-alone results of RCL declared either in the earlier years or in the current year. This entry of consolidated accounts is to comply with the accounting standards on consolidation,” it added.

RCL, meanwhile, reported a sharp drop of 79.18 per cent in its consolidated net profit for the fiscal ended March 31, 2005 at Rs 35.9 crore as against Rs 172.64 crore in the previous fiscal.

IPCL offers clarification

IPCL today clarified that Anil Ambani ceased to be a member of its board with effect from January 20. ‘‘It in an accepted position in law that a resignation takes effect on its being tendered, unless the articles of association of the company require acceptance bu the Board. The AoA of IPCL do not contain any provision requiring acceptance by the board of a resignation tendered by a director,’’ it said. ‘‘The resignation tendered by Anil Ambani therefore took effect immediately. This is evident from the Anil Ambani neither attended the board meeting of January 20 not sought leave of absence,’’ the statement said.

The company’s letter dated January 21 communicated to Anil Ambani that the board did not accept the conditions set by him but decided to request him to reconsider his resignation. Anil Ambani, in his reply dated January 27th appreiciated the board’s gesture but did not reconsider his resignation and instead put futher conditions on the board, which were not acceptable. These letters were noted by the board at the next meeting held on March 30th 2005, it clarified. —ENS