CG Power investors vote for appointment of Mathur as director

THE COMPANY HAS ALSO GOT SHAREHOLDERS’ NOD TO BORROW UP TO ₹5,000 CRORE TO MEET WORKING CAPITAL AND OTHER BUSINESS NEEDS

NEW DELHI: Fraud-hit CG Power and Industrial Solutions has got shareholders’ nod to borrow up to ₹5,000 crore to meet working capital and other business needs as it looks to spring back from the worst crisis in its history.

As many as 99.99% of shareholders, at the company’s annual general meeting in Mumbai on December 14, voted in favour of a resolution moved for raising borrowing limit, CG Power said in a regulatory filing on Tuesday.

They also approved appointment of Sudhir Mathur as whole time executive director of the company with an overwhelming 99.99% voting in favour of the resolution.

Mathur, who along with nonexecutive chairman Ashish Kumar Guha has been overseeing the clean up of the company after the alleged fraud of over ₹3,000 crore came to light, was first appointed as independent director on CG Power board on October 1, 2018 and moved into an executive role from May 10, 2019.

Shareholders approved both his appointments, the filing showed.

They also approved appointment of Narayan K Seshadri as independent director on the board of the company. In the shareholder notice, the firm had stated that its current borrowing as of March 31, 2019 was ₹2,455.39 crore (fund-based including short-term loans) and ₹1,380.00 crore (non-fund based).

“Keeping in view the existing borrowing and additional fund requirements and given the current financial condition of the company, the company is in urgent need of both long-term capital and working capital and towards this, the management of the company is in the process of identifying potential sources of capital,” it had said.

The company is also seeking external advice on mode and sources of fund raising.

“Hence, approval of the members (or shareholders) is sought for availing borrowings up to an amount of ₹5,000 crore for meeting the immediate funding requirements of the company,” it had said.

The company had in August said that an investigation instituted by its board had found major governance and financial lapses, including some assets being provided as collateral and the money from the loans siphoned off by “identified company personnel, both current and past, including certain non-executive directors”.