Kolkata, April 25 (IANS) The speciality steel maker and wire rope manufacturer Usha Martin on Tuesday removed its non-executive Chairman Prashant Jhawar with immediate effect after a “proposal put forth by the nominee director of the lenders”.
The company’s board appointed G.N. Bajpai, a Director of the firm, as the non-executive Chairman, in place of Jhawar.
However, the removed chairman of the company said the move was “improperly” executed.
“The Board of Directors of the company in their meeting held on April 25 has appointed G.N. Bajpai as the Non Executive Chairman of the company and of the board of the company in place of Prashant Jhawar with immediate effect,” Usha Martin said in a regulatory filing.
“In view of this, Prashant Jhawar has ceased to be the Non Executive Chairman of the company and of the board of the company,” the filing added.
Jhawar said: “I have been improperly removed from the position… No cogent reasons or rationale have been provided for my removal. Further, the board meeting, itself, was convened and held, without compliance with applicable corporate governance and secretarial standards and therefore, B.K. Jhawar (the Chairman Emeritus) and myself abstained from attending this improperly convened board meeting.”
He said declining performance of the Jhawars-led company as evident from the last 5-6 years financial statements, its massive debt interest burden and the capacity of the company to withstand further borrowings, among other issues, were a matter of grave concern to him.
“Also, while this proposal was put forth by the nominee director of the lenders, the motivations behind the board led by the management supporting this resolution are unclear,” he said.
The company had a net debt of Rs 3,731.86 crore as on March 16, 2016. It had reported a consolidated net loss of Rs 109.2 crore in the December quarter against a loss of Rs 89.57 crore in the year-ago period.