The Siemens Ltd’s proposal to sell its Rs 122.75-crore logistics and airport business to its parent has been opposed by a large section of the company’s minority shareholders.
The result of the postal ballot, announced on Wednesday, showed that 65 per cent public institutional shareholders voted against the resolution. However, the proposal was approved by majority.
Siemens AG holds 75 per cent in Siemens Ltd and institutional minority shareholders, including LIC (5.33 per cent), hold around 11.63 per cent.
Shriram Subramanian, MD of InGovern, a proxy advisory service, said minority shareholders have signalled their displeasure.
Siemens failed to place the valuation report online to the shareholders, he pointed out.
“The Company has not made sufficient disclosures for an independent assessment of the transaction. The company has taken refuge in legalese and not adhered to good corporate governance practices of full disclosure and transparency,” said InGovern in a recent note.
Grant Thornton India LLP has done an independent valuation.
The turnover of the two business verticals were Rs 33.8 core and Rs. 25.9 crore, respectively.
The verticals are predominantly engaged in providing infrastructure solutions, design and development, project engineering, project management, installation, operation, maintenance and consulting for airports, ports and postal automation. This is the fourth business restructuring since June 2011 that Siemens Ltd has undergone, prompted by promoters Siemens AG. In each of these instances, minority shareholding got diluted. The total dilution effected by this route was 3.48 per cent, which took the public shareholding to 25 per cent.
The Rs 2 Siemens stock on Wednesday closed at Rs 469 on the BSE, up 0.68 per cent.