Shareholders ask IL&FS to raise funds by selling assets

NEW DELHI: LIC, SBI and other key shareholders of debtridden IL&FS have asked it to raise funds by selling its assets or non-core businesses as a pre-condition for putting in additional money in the firm, sources said.

The shareholders held a meeting Wednesday and it was decided that additional money would be given when Infrastructure Leasing & Financial Services (IL&FS) generates cash on its own by selling some of its assets, the sources said.

IL&FS is seeking an immediate loan of around Rs 3,000 crore from key shareholders to help it tide over a cash crunch.

State-run LIC is the largest shareholder owning a fourth of the firm's equity, while Orix Corporation of Japan owns 23.5 per cent. Other shareholders include Abu Dhabi Investment Authority with 12.5 per cent stake, Central Bank of India with 7.67 per cent and SBI with 6.42 per cent.

According to sources, the company will sell its corporate headquarters in Mumbai as part of its plan to raise funds to meet the payment obligation.

Earlier this month, IL&FS defaulted on inter-corporate deposits and commercial papers. On September 4, it came to light that IL&FS had defaulted on a short-term loan of Rs 1,000 crore from Sidbi, while a subsidiary has also defaulted on Rs 500 crore dues to the development financial institution, which reportedly forced Sidbi to ask its chief general manager in charge of the risk management department to resign. In a letter to its employees, IL&FS claimed that if funds worth Rs 16,000 crore stuck with concession authorities were released on time, it would not have landed in this mess. NEW DELHI: Public companies will no longer require government approval for paying salaries beyond a certain threshold to their managerial personnel, according to a communication.

Easing the norms, the Corporate Affairs Ministry has amended provisions under Companies Act, 2013 in this regard. This will be applicable for public companies and not private companies.

Under the Companies Act, 2013, there are public as well as private companies. Generally, those having more than 200 members are classified as public companies and they have to follow stricter corporate governance norms. There are more than 70,000 public companies, as per official data.

The approval of the "central government shall no longer be required for the payment of remuneration to managerial personnel (in excess of 11 per cent of the net profit of a company)," the ministry said in a release Thursday.

Now, such payments can be approved by a company's shareholders through a special resolution.

In case a company has defaulted in payment of dues to any bank, financial institution or non-convertible debenture holders, approval of the entity concerned would be required before the remuneration proposal is put up to the shareholders.

The ministry said the move is in pursuance of the policy of minimum government-maximum governance and providing ease of doing business to the law-abiding corporates of this country.

"With the issue of the notification, all pending applications submitted to the Ministry for approval of proposals for payment of managerial remuneration in excess of the limits laid down, would automatically abate and companies are free to obtain requisite approvals for those proposals, from the shareholders within one year," the release said. Dipankar Ray, Executive Director, Indian Oil Corporation Limited West Bengal State Office inaugurated a new Community Hall at Singlebong Village, West Pendam, East Sikkim, under CSR scheme