The Indian government has taken the control of the debt-ridden Infrastructure Leasing & Financial Services (IL&FS). As a start, the government filed an application with the National Company Law Tribunal (NCLT) to dismiss the current board of IL&FS.
The government thought it would be detrimental to run the firm with its current directors.
The petition filed was accepted by the court on Monday afternoon and the new board will meet on or before October 8. The government argued that IL&FS’ existing board be suspended after a series of defaults by the company led to the meltdown of confidence in financial markets.
The board was replaced with a new six-member panel headed by Managing Director of Kotak Mahindra Bank Uday Kotak. He will be joined by ICICI chairman GC Chaturvedi, former vice-chairman of Tech Mahindra Vineet Nayyar, former Sebi chairman GN Bajpai and bureaucrats Malini Shankar and Nand Kishore.
The list of 15 members board that was sacked by the government:
- Sunil Behari Mathur – Non-Executive Chairman, IL&FS (Independent Director)
- Hari Sankaran – Vice Chairman & Managing Director, IL&FS
- Arun K Saha – Joint Managing Director & CEO, IL&FS
- Praveen Kumar Molri – Nominee Director, Life Insurance Corporation Of India
- Kiyoshi Fushitani – Nominee Director, Orix Corporation, Japan
- Harukazu Yamaguchi – Nominee Director, Orix Corporation, Japan
- Sanjeev Doshi – Nominee Director, Abu Dhabi Investment Authority (AIDA)
- Bijendra Kumar Singhal – Nominee Director, Central Bank Of India
- Chalasani Venkat Nageswar – Nominee Director, State Bank Of India
- Ravindra Chandra Bhargava – Independent Director
- Michael Pinto – Independent Director
- Jaithirth Rao – Independent Director
- Rina Kamath – Independent Director
- Kiyokazu Ishinabe – Alternate Director To K Fushitani
- Ikuo Nakamura – Alternate Director To H Yamaguchi
This is not the first time the government is taking control over a private firm. Earlier in 2009, Sathyam Computers was taken over by the government when an accounting scandal was found.
HrNxt.com Newsdesk has researchers and writers with an excellent domain knowledge about the talent ecosystem, and the business environment. The team keeps a tab on the latest happenings in the ecosystem to bring most relevant news and insights for our readers. You can connect with our newsdesk at newsdesk@hrnxt.com.