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Journalism of Courage
NEW DELHI, MAR 4: In a letter to the Sterling Group, RBI said that the TMB’s board of directors which met in early January had decided not to make a reference to the apex bank on the matter, making the RBI unable to decide on the transfer of shares.
Top sources in the apex bank said that RBI would consider the request for transfer of shares by Sterling "once the TMB board makes a reference for acknowledgement by the RBI."
Sterling Group owns 67 per cent stake in TMB following purchase of shares from the Essar Group three years ago. However, RBI acknowledgement which is mandatory for approval of management control has been pending.
According to banking sources, the present TMB board cannot decide on the matter as the Sterling Group, with its overwhelming stakes in the bank, can easily fill-in their representatives on the board.
Referring to the possibility of off-loading Sterling Group’s stake, company sources said there should be an independent evaluation by a leading merchant banker to arrive at a fair and reasonable price for the 67 per cent stake.
Sources also indicated that the group would consider selling the stake to a third party, if a settlement was not reached soon. D Ramachandra Adityan, chairman of Nadar Mahajana Share Investors Forum, in a statement in Chennai early this week, said that the forum was ready to buy the Sterling Group’s shares at a "fair and reasonable price".
However, as the Nadar community did not have the funds to acquire the shares, the only way out would be to ask financial institutions like IDBI, ICICI and even state financial institutions to buy the Sterling Group’s shares, banking industry sources said.
Even the 25 per cent stake in TMB held by the Nadars are split between several individuals, they pointed out. With Sterling Group controlling the majority stakes, the TMB has not conducted its annual general meeting (AGM) for the last three years, sources said.
