MUMBAI: The Kirloskar family feud took a surprise twist when Kirloskar Industries Ltd (KIL), a promoter of Kirloskar Brothers Ltd (KBL), voted against the re-appointment of an independent director to KBL’s board during its AGM on Friday citing mistrust of the director’s independence and impartiality.
The resolution to re-appoint Kishor Chaukar on the board of Kirloskar Brothers was blocked with only 65.7% votes in his favour. Re-appointment of an independent director is a special resolution and needs 75% of shareholder votes to pass.
KIL, which holds a 23.9% stake in KBL, also voted against the resolutions to re-appoint Alok Kirloskar as a non-independent director and to appoint MS Unnikrishnan as an independent director, but these, passed as ordinary resolutions, need only 50% votes in favour.
“The entire Kirloskar family other than Sanjay (and his immediate family) has voted against the appointment of Mr. Chaukar. The correspondence engaged by Mr. Chaukar with one of the promoters (of KIL) created suspicion about his independence on the board of KBL,” read a statement from KIL.
An email sent to Sanjay Kirloskar for comment remained unanswered till press time Monday.
This is the latest development in the ongoing feud amongst the fourth generation of the industrialist family with Sanjay Kirloskar on one side and his brothers Atul and Rahul and the rest of the family on the other.
Sanjay, the second son of Chandrakant Kirloskar, is the CMD of KBL. Elder brother Atul Kirloskar is the chairman of KIL.
Chaukar’s 5-year term as an independent director of KBL ended on 26 April this year. The company passed a resolution on 22 April to appoint him as an additional director in the category of independent director with effect from 27 April till the conclusion of the ensuing AGM.
KIL had sent a letter to KBL and the registrar of companies on 12 May in which it said that calling it an “appointment” as an additional director rather than a “re-appointment” was against the Companies Act, 2013. ET has seen a copy of this letter.
Chaukar responded saying KBL would follow due process and pass a special resolution for his re-appointment as an independent director during the subsequent AGM. He also referred to the private deed of family settlement (DFS) between the brothers in his reply.
The mention of the DFS was the bone of contention for KIL, said a person aware of the development asking not to be named.