Minority shareholders of Raymond Limited voted against the resolution for the proposed sale of JK House to members of the promoter family below market price.
“The company had put forth all relevant facts pertaining to the tripartite agreement between the company and related parties, with respect to apartments in JK House for shareholders’ considered decision making,” said a company statement, adding that the shareholders voted against the resolution.
Raymond held its 92nd annual general meeting at its registered office in Ratnagiri, where 97.67% of shareholders voted against the resolution.
The vote was to decide on the 2007 agreement between Raymond, which owns JK House, subsidiary Pashmina Holdings Ltd. that leased JK House from Raymond and four members of Gautam Singhania’s immediate family, including father Vijaypat Singhania and cousin Akshaypat Singhania.
Pashmina Holdings sub-let the four duplex flats to the family members from 1994 on monthly rent of ₹7,500 per flat. The 2007 agreement said that once renovations of JK House were complete, at Raymond’s expense, the flats were to be sold to the tenants at ₹9,200 per sq. ft.
“I am happy with the outcome of voting... as this decision... is in the best interests of the company and shareholders and is aligned to my personal opinion on this issue," said Gautam Singhania, CMD, Raymond.
Proxy advisory firm IiAS in its May 24 note advised the shareholders to vote against the resolution calling Raymond “The Complete Rip-Off” as the sale price was 90% discount to the prevailing market value, causing an “opportunity loss” of nearly Rs650 crore to Raymond’s shareholders.
Raymond shares at BSE closed up 7% at Rs 752 in a flat Mumbai market on Monday.
