Company Law Board Asks Il&FS To Appoint 4 Directors, Including Chairman, On The Board; Central Government To Have 2 Nominees On The Maytas Board.
The Company Law Board has allowed the application of Maytas Infra Limited to hand over the Management of the Company to IL&FS. Passing this Order here today, the Principal Bench of the Company Law Board said that IL&FS shall be the new promoter of the company with immediate effect and that it shall appoint four of its nominees, including the Chairman, on the Board of Directors of the company; and will be in control of the management of the affairs of the company. The order further says that on appointment of these four directors, Shri Teja Raju and Shri B. Narsimharao shall submit their resignations as directors and shall thereafter cease to be directors of the company. At the choice of the Central Government, two of the four Company Law Board nominees appointed by the Central Government shall continue as directors for a period of two years, the order states. The Company Law Board has also asked IL&FS, which holds 14.5 % shares in Maytas, to foreclose its rights on the pledged shares of 22.6 % shares and thus to hold 37.1 % shares in the company. Also, IL&FS will have to bring in up to Rs. 55 crore as liquidity support to the company within a period of three months. The order also asks IL&FS to continue to hold a minimum of 26 % shares in the company for a period of not less than two years and to keep management control of the company during that period.
Earlier the Board of Directors of Maytas Infra Limited had held a meeting and accepted the offer of IL&FS to step in as the new promoter of the company so as to restore the credibility of the company and to bring in necessary funds. All the major stakeholders in Maytas Infra Limited were also unanimous in changing the exiting promoter. Accordingly, the Board of Directors of the company recommended the change of guard at the Maytas Infra Limited to the Company Law Board, which heard the application and passed the order today itself.
