Dunlop Employee Unions Look To Fis For Succour

The All-India Dunlop Employees Federation has demanded immediate government intervention to save the company from sinking any further.

Union sources said there was no hope for the company unless financial institutions, which hold 33 per cent in the firm, take complete control.

Money is being siphoned off from Dunlop as was the case in Shaw Wallace. So like the latter we want financial institutions to take direct control of the company, with a minimum of two nominees on the board, the sources said. A section of the unions is also toying with the idea of submitting a petition to the Company Law Board (CLB). The unions of the Manu Chhabria flagship had also submitted a petition to the CLB, which had then appointed two nominees on the liquor majors board.

 

The union feels this would prevent the mismanagement of the company resources and a further misuse of funds. Appointment of FI nominees on the board would also ensure proper implementation of loans from the institutions, they felt. Currently, the only FI nominee on the Dunlop India board is S N Sundaresan of the Life Insurance Corporation, the largest institutional shareholder with a 22 per cent stake.

But in the wake of the current crisis, Chhabria has made it amply clear that being the single largest shareholder of Dunlop India, with a 44 per cent stake, he would never lose control over his company.

Meanwhile, federation members, mostly belonging to the two headoffice unions, claim that the executive management has not sought their help in ousting Chhabria.

The Sahagunj unions have, on the other hand, been claiming that senior executives on behalf of managing director, M D Shukla, have spent the entire last week at the companys main manufacturing unit convincing them of their importance in the fight against Chhabria.

The Sahagunj unions also claimed to have decided to seek the intervention of West Bengal chief minister Jyoti Basu, jointly with the executive management, to defuse the current crisis.

The federation members have, however, emphasised that they will have no part in the boardroom struggle. The main aim of the federation is to protect the company and provide security for all the workers while ensuring the wheels of production keep turning, the sources added.

In Dunlop, the damage has already been done. Apart from financial matters, the institutional image of the company has been severely bruised, federation sources said.