By LE Desk
New Delhi, March 11: Continuing the fight to get a seat on conglomerate Murugappa Group’s board, Valli Arunachalam and her mother MV Valli Murugappan moved a waiver application in the National Company Law Tribunal (NCLT), Chennai.
They sought a waiver on the minimum shareholding requirement of 10 per cent to maintain the case against Ambadi Investments, the holding company of the Murugappa Group, and also family members for alleged mismanagement and oppression. Murugappa family members are the majority shareholders in Ambadi investments, The News Minute reported.
Senior Counsel S Raman, representing Valli, pointed out that she and her mother have a shareholding of 8.21 per cent in Ambadi Investments, falling short by 1.79 per cent as required by Section 244 of the Companies Act. As part of Section 244, the party is required to hold at least 10 per cent to move a case on the grounds of oppression. Raman flagged a precedent in such a matter, stating that certain firms of Cyrus Mistry had received a waiver from NCLT Delhi from the minimum requirement for maintaining a case against Tata Sons.
To the NCLT, Raman said that the main petition deals with issues pertaining to gender bias.
“The Murugappa family has a history of gender discrimination as Murugappan was the only male member of the family who did not have a male legal heir. We are making a very serious allegation of gender discrimination. When Valli Arunachalam’s name was proposed to the board, they replied that she was not qualified,” Raman reportedly said. Valli has a doctorate in nuclear physics and works for a Fortune 500 company, Raman added.
It was also pointed out that the main petition also seeks a fair buyout of the 8.15 per cent stake as per 242 (2b) of the Companies Act, 2013 — the purchase of shares of any members of the company by other members or by the company. The plea for waiver said that there is also a refusal to provide fair value exit from AIL.
The respondents have been given three weeks to respond, and the tribunal posted the matter for hearing to April 23.
In October last year, Valli Arunachalam and her family issued legal notices to the members of the Murugappa family, and had said that they had reached the end of the road for an amicable settlement. It alleged that numerous requests of the applicants were faced with non-cooperation, delay tactics and malafide intentions by the Murugappa family.
In 2017, when the former executive chairman of the Murugappa Group, MV Murugappan passed away, he left his 8.15 per cent stake to his daughters and wife. Since then, Valli has been fighting to either become the first woman on the Board to make sure she and her family’s rights are preserved as promoter and major shareholder. Valli either wanted to sell the family’s stake to another family member or get a seat on the board of Ambadi. As a shareholder, it is a right, she can seek to exercise and be voted on.
She even had to fight for her nomination to be allowed, but in September last year, the Board rejected her appointment to it.
The company has a long-standing tradition of having only men in the leadership.