Tuticorin: Company annual general meetings are normally not eagerly awaited affairs, for the proceedings tend to be remarkably dull.
However, once in several years, like the Kumbh Mela or the Mahamagam, one does get to witness an interesting AGM where the high and mighty are brought down to earth by the one-day sultans - in this case, the individual shareholders!
Historically, one such AGM - in the late 1990s - was that conducted by Best & Crompton, in which the shareholders dubbed the company chairman, the UB Group's Vijay Mallya, an "NPA - a non performing asset" and even asked him to resign!
Employee shareholders, with placards and slogans against Mallya, had added color to the drama. The meeting was adjourned, as it was unable to transact any business. The UB group later sold Best & Crompton to an Indonesian concern.
The annual general meeting of the unlisted Tamilnad Mercantile Bank (TMB) held on 12 March 2004, was one of those lively shareholder meetings that had all the essential ingredients of a good soap opera. There was comedy and tragedy, leading up to a tension-filled climax and, finally, a happy ending - leaving everyone altogether satisfied with the experience.
The meeting itself set a record of sorts. Being held after a gap of seven years, the AGM considered and passed the accounts of the previous seven years, and also elected ten directors - that is the entire board - all at one go!
The run-up to the AGM
TMB is one of the few unlisted companies in India that has a wide shareholding - around 29,000 in all. Many of these are first-time shareholders, with just one or two shares to their names!
For the past few months the bank's secretarial department, headed by K K Sarma, its company secretary, had been diligently plodding through more than 25,000 share transfer forms lodged by the new shareholders, and issuing fresh share certificates.
Having executed this mammoth task, they buckled down to tackling the dispatch of the AGM notice and the annual accounts of the last seven years. The AGM, which was initially slated for 7 December 2003, was postponed to 12 March 2004. So the department then got down to the business of sending revised notices, with fresh changes in the business to be transacted.
Having braved all this, the department then found itself being deluged by a flood of proxy forms. This transpired as the warring Nadar factions of the shareholders started mobilising for battle - and as part of their battle plans, began lodging proxy forms. As the bulk of the proxy forms were being lodged with the AGM date creeping ever closer, a fresh nightmare ensued for the secretarial department. The bank scrambled fast and got new software written to process these forms!
The Madras High Court then got into the act by extending the deadline for lodging of proxy forms with the bank, right up to 24 hours before the scheduled time of the meeting. The secretarial team now spent a sleepless night preparing the proxy register - opening it for inspection only at midnight!
Overcoming family grief
Unknown to the officials of the secretarial department, their company secretary Sarma was also labouring under the stress of a deep personal tragedy, for just a day before the AGM was due, he had received news that his brother's wife had expired. Displaying a remarkable sense of duty and dedication towards his job, Sarma decided to stay put and see the AGM through, for leaving at this juncture would have put his department in a bind. He eventually left town only after the AGM.
At the venue
Elaborate security arrangements were made at the Kamaraj College grounds. A huge shamiana was erected to keep the sun out, and around 7,000 chairs were arranged for and neatly lined up. Separate entrances were created for the shareholders, the proxy holders and the promoters. Uniformed and plainclothes policemen were present in sizable numbers, and entry to the venue was allowed only after frisking with metal detectors. But contrary to expectations only around 3,000 shareholders/proxies turned up for the AGM - a sizable number still!
The atmosphere was akin to the general body meeting of a political party and certainly bore no resemblance to the AGM of a bank. To make the similarities even more obvious, one of the contenders, for the post of director had brought his supporters in vans plastered with posters.
The Company Law Board (CLB) had laid down the schedule for the meeting and the AGM commenced accordingly at 9.30 am. Present on the dais were S Ramalingam, a retired judge, and also the chairman of the AGM, along with R Natarajan, TMB''s chairman and chief executive officer. Also present were N R Krishnan and B Ramani Raj, nominees of the central government and the Reserve Bank of India respectively. B Ravi, a practising company secretary, was appointed by the CLB to assist Ramalingam in the deliberations.
At the start, when the chairman began his introductory speech in English, the shareholders demanded loudly that he speak in Tamil. B Ravi was then accorded the honour of translating into Tamil whatever was spoken/read out by the persons on the dais or by the shareholders!
The first item on the agenda was to transact the business pertaining to the year 1996-97. When the annual accounts for that particular year were sought to be approved, two shareholders immediately demanded a poll.
To the surprise of many, the meeting chairman initially said that the request was under consideration, but then realising that as per the legal provisions the demand had to be conceded, he later agreed to hold the poll.
For some time the shareholders found themselves being informed, invariably, that their questions were being jotted down and the bank would eventually post its response. Irked by this uniform response to every question, one shareholder reminded the officials on the stage that it was the management''s duty to answer the questions raised by the shareholders at the AGM itself!
At one point, a shareholder began to address the gathering like a typical Tamil politician, with an elaborate salutation to all and sundry. When asked to restrict himself to the point he wished to make, he curtly responded that it was a Nadar, and also a Tamil, tradition to address the gathering respectfully before coming to the point!
Finally the anti-climax
Except for these unusual moments, the AGM, surprisingly, did transact the business on hand smoothly. Even the poll for electing the directors, where trouble was expected, passed off peacefully. While many had felt that the election would be a closely fought affair amongst the Nadar factions, it turned out to be an anti-climax with the group led by press baron B Ramachandra Aditan winning the elections with a massive margin. (See )
When the curtain finally came down around 2.30 p.m., the relief on the faces of the bank officials was palpable. Certainly this was one of the more memorable AGMs held in Indian corporate history!
also see : TMB
gets new board. Losers to approach the court