ZEEL Board meeting on Invesco case
Punit Goenka has exposed Invesco’s double standards. In his letter, he clarified that Invesco representatives had approached him about a combination with a strategic group. This discussion also included Arun Baloni of Invesco and Bhatosh Bajpai of OFI Global China Fund. In front of Punit Goenka, both promised to merge with a large strategic group in India. The ‘Strategic Group’ valuation was proven to be exaggerated.
According to Punit Goenka, the deal has cost ZEEL’s investors tens of thousands of crores. Promoters would receive only 3.99 percent of the merged entity. Punit Goenka would receive a 4 percent ESOP in the merged entity. Punit Goenka was proposed as MD & CEO of the new business as well. According to Goenka, if the acquisition is completed, the strategic group will own a majority ownership in the new firm formed as a result of the merger. Invesco also requested that Punit Goenka be named as MD and CEO.
Invesco’s offer for Goenka
According to the board note, Invesco insisted on the new amalgamated entity’s operations and business being led by Punit Goenka, while submitting the proposal. Invesco had admitted that Goenka’s expertise and professional competence would make it critical for him to continue as MD and CEO.
Anyone else behind Invesco?
Punit Goenka, according to the letter provided by ZEEL, had also flagged several governance difficulties in the purchase (especially regarding the valuation of the Strategic Group). Invesco further stated that the transaction might be completed with or without them. Invesco continually warned Goenka that if he didn’t go ahead with the deal, he and his family would face losses.
Read the full letter here.