6 April 2001
Probe into Gelli-Parekh links still on, says RBI
Mumbai: The RBI says that the Global Trust Bank probe is still on and chairman Ramesh Gelli will not be able to escape the Securities & Exchange Board of India (Sebi) dragnet if found guilty of insider trading despite the merger with UTI Bank being cancelled. RBI officials maintain that it is not calling off the probe. Since GTB has decided against going ahead with the merger the RBI has merely informed the Sebi about the development. This is a communication between two regulators on the development of an on-going issue. We have not asked Sebi to stop investigations,“ said an RBI source.
5 April 2001
GTB merger with UTI Bank off
Mumbai: This was a merger destined to be doomed. Finally the Global Trust Bank, GTB, has pulled out of the proposed merger with UTI Bank. Though Sebi continues to investigate the matter, this breakup of merger plans will cool things for GTB, for the time being.
The board of GTB has informed the stock exchanges of its decision to withdraw the merger proposal. The GTB decision came after a crucial board meeting of the bank in Mumbai, where the board finalised the annual results of the bank. The board has unanimously resolved to withdraw the merger proposal.
The decision by GTB comes at a time when neither UTI chairman PS Subramanyam nor UTI Bank chairman PJ Nayak is in Mumbai. Mr Subramanyam had earlier stated clearly that as far as UTI Bank was concerned, the merger plan was on hold and on the backburner, following the allegations against GTB.
Prior to the board meeting, GTB chairman Ramesh Gelli is understood to have spoken to both Mr Subramanyam and Dr Nayak and informed them about the thinking in the bank. After the meeting, the top brass of GTB met RBI deputy governor SP Talwar and conveyed the decision to call off the merger.
In January this year the UTI Bank and the Global Trust Bank had come together to jointly form India's largest private bank the UTI Global Bank. The chances of the merger proposal getting RBI approval became dimmer after a Sebi interim report held Ketan Parekh responsible for allegedly ramping up the GTB share price before the merger.
The report also alluded to an alleged nexus between Parekh and the GTB top brass. Following the revelations, UTI Bank gradually distanced itself from the merger, leaving the ball in GTB's court to withdraw the merger proposal.
Relations between GTB and UTI Bank were strained following allegations of price rigging in the GTB scrip prior to the merger. The UTI Bank board is expected to meet on April 11 to formally withdraw its merger application with the RBI.
Government clears FDI proposals worth Rs 545 crore
New Delhi: The commerce and industry minister Murasoli Maran has cleared 44 FDI proposals involving a total inflow of Rs 545 crore.
These include those of Eli Lilly Ranbaxy to buy out Ranbaxy's holding of 50 per cent in the joint venture, Abbott Equity Holding of the UK, General Electrical International and Indian Infrastructure Equipments. Eli Lilly will buy out Ranbaxy's 50 per cent stake for Rs 79.9 crore and thus convert the JV into 100 per cent subsidiary.
General Electric International has been permitted to set up a 100 per cent subsidiary to venture into infrastructure and information technology enabled services, telecommunications and Internet. The company will invest Rs 47 crore in the project.
Abbot Equity Holding Ltd has been allowed to bring in Rs 106.27 crore to pick up 20 per cent stake in a project to manufacture pharmaceutical formulations.
