21/05/ /05/2018

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1 B 21/05/ /05/2018

2 Four members of Fortis board under scrutiny, all eyes on EGM Shareholders will vote on the fate of four board members of Fortis Healthcare, accused of not upholding corporate governance standards, at the company's extraordinary general meeting (EGM) called by some investors on May 22. Minority shareholders East Bridge Capital and Jupiter India Fund, which hold around 12 percent stake in the company, moved a special resolution in April to discuss the removal of four members from the board at the EGM. The directors, Brian W Tempest, Harpal Singh, Lt Gen. Tejinder Shergill and Sabina Vaisoha, are accused of running an opaque bidding process, which hampered effective price discovery for Fortis. Manipal-TPG, Munjal-Burmans, Malaysia's IHH, KKR-backed Radiant Life Care and China's Fosun bid for Fortis after it fell into financial problems. Its former promoters, the Singh brothers, are also under investigation for siphoning funds out from the company. Last week, the four directors along with another additional director Rohit Bhasin had voted in favour of Munjal-Burmans offer. Three other directors Suvalaxmi Chakraborty, Ravi Rajagopal and Indrajit Banerjee representing minority shareholders East Bridge Capital and Jupiter India Fund opposed the offer. The offer will now have to be approved by shareholders. Some media reports said that Fortis' financial advisers - Arpwood Capital and Standard Chartered Bank, and legal adviser Cyril Amarchand Mangaldas - were also against the Munjal-Burmans' offer. Analysts have questioned the board's earlier decision to allow bids without due diligence, saying it did not lead to efficient price discovery. There is room for bidders to increase the price if they have greater certainty on what to expect: in having to bid blind, some of them could have likely priced in an exaggerated approximation of the potential liabilities, said proxy advisory firm IiAS.

3 production. The directors have defended their decisions, stating that due diligence would delay the offers and would address the company's "immediate financing needs". In their notice calling for the EGM, East Bridge Capital and Jupiter said the current members of the board "do not fairly represent the interest of all shareholders and the company, and considering the recent events, their continuance on the board is untenable. IiAS also recommended supporting resolutions of East Bridge Capital on removal of the four directors. All four members of the current board have been associated with the Fortis group, Religare group, or Ranbaxy for long tenures in the past. This has led to them being accused of working at the behest of erstwhile promoters of Fortis, Malvinder Singh and Shivinder Singh. Singh brothers now hold around 0.77 percent stake in the company. Harpal Singh (67), is the father-in-law of Fortis' erstwhile chairman Malvinder Singh, who is the mentor and chairman emeritus of Fortis Healthcare. Harpal Singh is also on the board of Fortis diagnostics' arm SRL. Seventy-year-old Brian Tempest, a UK national, is associated with group companies of Singh brothers in both executive and non-executive roles for around two and a half decades. He worked for Ranbaxy since 1995 holding the position of Managing Director and Chief Executive Officer until He was then Chief Mentor and Non-Executive Director on Ranbaxy board until 2008 when Ranbaxy was sold to Japanese drug maker Daiichi Sankyo. Daichii subsequently sold Ranbaxy to Sun Pharma. Daiichi is trying to enforce Rs 3500 crore arbitration award against Singh brothers whom it accuses of concealing the extent of regulatory troubles at the company. Ranbaxy pleaded guilty and agreed to pay USD 500 million to US authorities to settle a criminal and civil lawsuit which levelled charges of falsifying data from its drug facilities and shoddy manufacturing practices against it.

4 HOT PURSUIT South Indian Bank fined Rs 5 crore for non-compliance of NPA, KYC and treasury norms Reserve Bank of India (RBI) has slapped a Rs 5 crore penalty on South Indian Bank for violation of bad loan classification, know-your-customer (KYC) guidelines, treasury functions and other noncompliances. The central bank said it has imposed, "...by an order dated May 14, 2018, a monetary penalty of 50 million on South Indian Bank Limited (the bank) for non-compliance with the directions issued by RBI on Income Recognition and Asset Classification (IRAC) norms, Know Your Customer (KYC) norms and treasury function and for deficiencies in its compliance function and compliance culture. The central bank said that the action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement the bank has entered into with customers. On May 15, South Indian Bank reported divergence in asset classification of provisioning towards non-performing assets (NPAs) in comparison to RBI's assessment for The gap with respect to gross NPAs was Rs 8.39 crore, while for net NPAs, the divergence came in at negative Rs crore. Its profit had jumped 51 percent to Rs crore for the March quarter in FY18, driven by healthy interest income and less provisioning for bad loans. In March, ICICI Bank was fined Rs 58.9 crore by RBI for failing to adhere to its directives regarding the sale of securities from the held-tomaturity or HTM portfolio. In April, the banking regulator penalized IDBI Bank to the tune of Rs 3 crore for failing to comply with norms related to reporting of bad loans. Earlier this week, RBI imposed a penalty of Rs 50,000 on Universal Co-operative Urban Bank, Manchurian, Telangana for violations on loans and advances. Previously, the central bank had charged Indian Overseas Bank, Axis Bank, Yes Bank, IDFC Bank, IndusInd Bank and RBL Bank for violation of asset qualification and KYC norms.

5 No decision about H4 visas is final until rulemaking process is completed: USCIS No decision about H-4 visas is final until the rulemaking process is completed, a senior US official has said, days after over 100 lawmakers urged the Trump administration to continue granting work authorization to certain dependent spouses of non-immigrant workers holding H-1B visas, the most sought-after among Indian IT professionals. The Trump administration is planning to revoke a rule that makes spouses of thousands of immigrant workers eligible to work while in the US, a move that could have a devastating impact on tens of thousands of Indians. H-4 is issued to the spouse of H-1B visa holders, a significantly large number of whom are highskilled professionals from India. They had obtained work permits under a special order issued by the previous Obama administration. The move to end the Obama-era rule could have an impact on more than 70,000 H-4 visas holders, who have work permits. "No decision about H-4 visas is final until the rulemaking process is completed," Philip Smith, a US Citizenship and Immigration Services (USCIS) spokesperson told PTI.This comes days after more than 130 influential lawmakers wrote a letter to the US Homeland Security Secretary not to rescind the Obama administration's decision to provide work authorization to certain categories of H-4 visas, which are mainly spouses of H-1B visas. He was responding to questions on the letter to the Homeland Security Secretary Kirstjen Nielsen signed by more than 130 lawmakers in this regard. "The opportunity for H-4 visa holders to work has made our economy stronger, while providing relief and economic support to thousands of spouses, mostly women, who have resided in the United States for years," the letter said. Many are on the path to permanent residency and would already be permanent residents if not for the decades-long employment backlogs. Rescinding the rule will hurt the competitiveness of US employers and the US economy, as well as H-4 accompanying spouses and their families. We strongly urge you to reconsider this action," the lawmakers wrote.

6 Govt non-committal on excise duty cut on petrol, diesel Rising global oil prices may push up India's import bill by up to USD 50 billion, impacting current account deficit, but would have little effect on growth, Economic Affairs Secretary Subhash Chandra Garg said today even as he remained non-committal on cutting excise duty to ease the burden on consumers. The government is watching the situation developing from oil prices hitting USD 80 a barrel -- the highest since November 2014, and adequate steps will be taken, he told reporters here without elaborating. Asked if the government would cut excise duty on petrol and diesel, he said he has nothing to say on that front. "Just watch." The BJP-led government had raised excise duty nine times -- totaling Rs per litre on petrol and Rs on diesel -- between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by Rs 2 a litre. Garg parried questions on whether the government was considering a cut in excise duty, which makes up for a fourth of retail selling price. Asked at what levels of oil prices would the government decide to tweak taxes, he said, "it would be difficult to give a figure". Petrol prices have risen by about a rupee per litre since Monday when state-owned fuel retailers resumed daily revision in retail prices after a 19-day pre-karnataka poll hiatus. Diesel prices have gone up by Rs 1.15 a litre during this period. Petrol now costs Rs per litre in Delhi, the highest in almost five years, and diesel rate is at an all time high of Rs Garg said the price of basket of crude oil which India buys has gone up in last few weeks. "Any increase in oil prices definitely has a lot of impact on our economy," he said. The growth parameters are also very sound, macroeconomic parameters also continue to be very sound, the inflation is within the range. So on the macro-economic front the economy continues to do well and we have no downward revision on growth or upward revision on fiscal deficit.

7 Saudi Arabia assures on supply as oil hits $80 a barrel Saudi Arabia said on Friday it is consulting other oil producers in and outside OPEC to ensure the world has adequate supplies to support economic growth after prices hit $80 a barrel for the first time since OPEC's most influential energy minister, Saudi Arabia's Khalid al-falih, said in a Twitter post that he had called his counterparts in the United Arab Emirates, the United States and Russia, as well as major oil consumer South Korea, to "coordinate global action to ease global market anxiety". Falih also said he had reassured the executive director of the International Energy Agency of "commitment to the stability of oil markets and the global economy" and that he would contact others over the next few days. On Thursday, Falih called Indian Petroleum Minister Dharmendra Pradhan to assure him that supporting global economic growth was "one of the kingdom's key goals", the Saudi government said in a statement, after India expressed frustration with the recent surge in oil prices. Oil prices held firm on Friday, with Brent crude trading at around $79.70 per barrel after the international benchmark broke through $80 for the first time since November 2014 the previous day. The Saudi Energy Ministry said on Thursday that the kingdom together with other producers would ensure the availability of adequate supplies to offset any potential shortfalls. India s Pradhan had expressed concern about the negative impact of escalating prices on consumers and especially the Indian economy, the world's third-largest oil consumer. India is one of the world's fastest-growing energy consumers and its oil use lags only that of the United States and China. The Organization of the Petroleum Exporting Countries and its ally Russia have cut their output since January 2017 to help reduce excessive global stockpiles. So far, OPEC has said it sees no need to ease output restrictions despite a fall in global stocks to the group's desired levels and concerns among consuming nations that the price rally could lead to demand destruction.opec member the UAE said on Thursday OPEC had bigger issues to consider than the impact of the U.S. decision to withdraw from the international nuclear deal with oil producer Iran, such as Venezuela's collapsing oil output. U.S. President Donald Trump has also called on OPEC to help cool oil prices, saying they were artificially high.

8 Ram Jethmalani moves SC against Karnataka governor's decision inviting BJP to form govt Senior lawyer and jurist Ram Jethmalani today moved the Supreme Court in his personal capacity against the Karnataka governor's decision to invite the BJP to form government in the state, saying it was a "gross abuse of constitutional power". A bench headed by Chief Justice Dipak Misra considered the submission of Jethmalani seeking urgent hearing and said that a three-judge special bench, which had heard the matter in the early hours, would re-assemble tomorrow. The bench also comprising Justices A M Khanwilkar and D Y Chandrachud asked the veteran lawyer to make his submission before the three-judge bench led by Justice A K Sikri on May 18 when the petitions filed by the Congress party and the Janata Dal (Secular) (JD(S)) would be taken up for further hearing. The governor's order is a gross abuse of the constitutional power and this has brought disrepute to the constitutional office he has been holding," Jethmalani submitted while seeking nod to submit his views in the case. He said that he has not come before the court in favour or against any party but has been hurt over the unconstitutional decision taken by the Governor. The Supreme Court bench, which also comprised Justices S A Bobde and Ashok Bhushan, today in a pre-dawn hearing refused to stay Yeddyurappa's swearing-in as Karnataka chief minister after the Congress-JD (S) combine made a last-ditch attempt to stall the saffron party's surge in the southern state. The Congress alleged that the BJP, which has 104 MLAs, was invited by the Governor to form the government "in an unconstitutional manner" even as JD(S) leader H D Kumaraswamy along with Congress has the support of 116 MLAs. In the May 12 polls, BJP emerged as the single largest party with 104 members, while the Congress secured 78, the JD(S) 37 and others three.

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