Raymond independent directors hire lawyer to protect minority shareholders

The five independent directors of Raymond have hired Berjis Desai, an independent senior lawyer, for advising the board on the family feud between company chairman Gautam Singhania and his estranged wife Nawaz Modi.

In a statement, the independent directors (ID) told stakeholders in the company they would act dispassionately and without taking any sides. “The paramount consideration shall always be the interests of the company as a whole and its non-promoter shareholders. Any material development or remedial measures which impacts the company shall be forthwith communicated in a spirit of complete transparency,” said the directors.

The directors said they have been monitoring the situation over the last few weeks and are committed to protect the interests of non-promoter minority shareholders, employees and other stakeholders.

They would ensure the matrimonial dispute between the two promoter-directors do not in any manner “affect the capacity” of the chairman and managing director (Singhania) to run the company, said the statement.

“However, it may be appreciated that neither any law nor any corporate governance standard requires ID to enquire into, investigate, or delve into the merits or otherwise, of such matrimonial disputes, which lie beyond the remit of the ID. The ID shall continue to exercise utmost vigilance in watching the evolving situation and shall not hesitate to proactively initiate measures, the moment required, to protect the interests of all stakeholders,” it said.

Raymond has lost significant market valuation since November 13 after Singhania announced he and Nawaz Modi, who is a director on the board, had separated.

The Singhania family owns half the company’s shares, which have lost value since the separation news became public on November 13. In a media interview to a publication, Modi alleged corporate governance lapses in the company and said that in a board meeting on November 8 she had raised a few issues regarding alleged misuse of company funds.

Others on the eight-member Raymond board are Singhania, Nawaz Modi, and S L Pokharna, who is Raymond group president. Nawaz Modi did not reply to questions sent by ‘Business Standard’.

Singhania said: “In the interest of my two sweetheart daughters and to respect my family’s dignity, I will refrain from offering any comment.”

Nawaz Modi has earlier alleged Singhania was trying to remove her from the board and she had protested at the gates of a Raymond factory in Thane, near Mumbai, on Diwali eve when she was denied entry to a company function.