Itc Fine-Tunes Corporate Governance Set-Up

Tobacco major ITC Ltd has made some alterations in its corporate governance set-up, with some issues being brought back to the board level.

A decision on the extent of funding from ITCs side into Singapore-based ITC Global is also not imminent in the immediate context.

The ITC Ltd board, which met yesterday, was apprised of the adjustments to the corporate governance set-up. The board also took stock of the progress on the imminent amalgamation of ITC Classic into ICICI.

On the corporate governance front, sources said ITC has made some alterations, with certain issues referred back to the board owing to functional difficulties being faced.

 

There are some issues where either operationally or according to the rules, all the powers cannot be delegated, sources said. This process of adjustment will take place from time to time.

ITC already has a Corporate Management Committee (CMC), headed by chairman Y C Deveshwar in place. It has also recently inducted two new executive directors and made some changes in the portfolio allocations at the board level.

The board also discussed the modernisation plans at ITCs cigarette making facility at Saharanpur.

The issue of funding ITCs ailing Singapore subsidiary, ITC Global, was also in the backburner, with the board not taking too much of time on the matter.

Sources pointed out that while discussions between ITC and the judicial managers of Global in Singapore were continuing, there was little possibility of an immediate decision on the issue.

The judicial managers, KPMG Peat Marwick, have indicated claims between $48 m and $49.8 million on Global.

According to available indications, ITC will bring back those employees who have been sent to ITC Classic, but no clear decision has yet emerged on the ITC side on how to treat the Classic employees who are not from ITC and do not get absorbed into ICICI.

ITC will hold an EGM on the Classic merger on January 9, 1998, followed by a court-sponsored Classic EGM on January 12. ITC will have to deposit the entire Rs 350 crore to be pumped into Classic by December 31 this year, according to the scheme of amalgamation.

Sources said ITC was looking aggressively for strategic partners for the brokerage firm Classic Share and Stock Broking which it is taking over from Classic as part of the merger deal.

While Daiwa Securities is being mentioned as a possible contender, there is no confirmation available on that as yet.

One of ITCs investment subsidiaries is acquiring the 50 per cent Classic stake in the mutual fund joint venture with Threadneedle.

The ITC board meeting was preceded by a meeting of the companys audit committee.