Fortis board revamp will add turbulence, say directors
Four directors of Fortis Healthcare Ltd facing potential removal at an upcoming shareholders’ meeting wrote to shareholders Wednesday to let them stay on, since “a complete change of the entire board” will add “turbulence and ambiguity”.
A group of Fortis minority shareholders have called for a shareholder vote between May 22 and May 30 to remove Brian W Tempest, Harpal Singh, Sabina Vaisoha and Lt. Gen. Tejinder S Shergill saying they failed to exercise their duties.
“Any delay in the publication of the results is the last thing that we as members of the board would want due to any reason,” the four directors said in a letter to shareholders, advising them make an “informed decision”.
An expert advisory committee set up by the Fortis board to evaluate bids for a potential sale of the company meets on 10 May. Then, the current board will recommend the suitable suitor to the shareholders.
A group of Fortis minority shareholders including East Bridge Capital and Jupiter India Fund in April requested an extraordinary general meeting to remove four members of board —Brian W Tempest, Harpal
NEWDELHI:
Singh, Sabina Vaisoha and Lt. Gen. Tejinder S. Shergill—on the grounds that the board failed to exercise its “fiduciary duties” towards all shareholders and failed to maintain expected levels of corporate governance. “Minority shareholders like us have lost confidence in the suitability, bona fides or independence of the current members of the board and therefore are seeking their removal,” stated the requisition cited by the board members in their joint statement.
In their letter, the directors tried to explain the rationale behind several “key decisions”.
“Taking the ground of governance and our fiduciary duty, we directed the management to accord all assistance to the investigating agencies, and to make sure that the allegations are thoroughly examined in order to facilitate a complete impartial investigation. None of us have tried to defend anyone and have in fact offered ourselves for questioning or forming a part of any investigation by any agency,” the members stated.
In their letter to the shareholders, the directors said the board decided to consider only binding bids as “the non-binding bids involved “considerable uncertainty” and merely running a due diligence process does not guarantee a binding bid.