Shareholders of Ambuja Cements approved all the 12 resolutions of the company with a whopping majority, including a proposal to raise up to Rs 20,001 crore from an Adani family firm. All the motions were approved at the company’s extraordinary general meeting held on Saturday.
The proposal by Ambuja Cements to raise funds by way of preferential allotment of warrants to Harmonia Trade and Investment was approved with about 91.36% of votes cast in favour.
Earlier in September, Ambuja Cements had proposed to issue 477.48 million warrants to Harmonia Trade on a preferential basis, constituting 19.39% of share capital (post issue) at Rs 418.87 each. Each warrant can be converted into a share within 18 months of issuance.
The resolutions to appoint Gautam S Adani, founder and chairperson of the Adani Group, and his elder son Karan Adani as non-executive non-independent directors were approved with 96.50% and 99.96% votes, respectively.
Other resolutions including appointment of MR Kumar as a non-executive, non-independent director (99.96% votes in favour), appointment of Maheswar Sahu (99.95%), Rajnish Kumar (99.96%), Ameet Desai (93.47%) and Purvi Sheth (97.63%) as independent directors also got shareholders’ approval.
Other resolutions that were green-flagged include appointment of Ajay Kapur (98.19%) as a whole-time director and CEO, and amendment to the Articles of Association (99.99%) among others.
Earlier, Institutional Investor Advisory Services India (IiAS), a proxy advisory firm, had asked shareholders of Ambuja Cements to vote against the fund-raising proposal.
“Assuming full conversion of the warrants, the issue will lead to a dilution of 19.4% on the expanded capital base, which is high. Promoter shareholding will increase to 70.3% from the current 63.1%. The issue price is at a 16.3% discount to the current market price of Rs 500.2 and at an 8.8% premium to the acquisition price from the Holcim Group,” IiAS had said in a note.
The proxy advisory firm had also advised them to vote against the appointment of Ameet Desai and Purvi Sheth as independent directors of the company, while it green flagged all the remaining nine motions.
Desai, who had held various positions with Adani Group, did not have a “cooling-off” period, and Sheth’s high number of directorships with listed companies were cited as reasons.
In September, Adani Group completed the acquisition of Ambuja and ACC through a special purpose vehicle, Endeavour Trade and Investment. The deal, announced on May 15 this year, comprises Holcim’s entire 63.11% stake in Ambuja Cements, which owns a 50.05% interest in ACC, and its 4.48% direct stake in ACC.