TCI demands removal of Narsing Rao
Puts its claim as minority shareholderA New Delhi (PTI): Giving new twist to the NTPC-CIL dispute, the UK-based hedge fund, The Children's...
Puts its claim as minority shareholderA
New Delhi (PTI): Giving new twist to the NTPC-CIL dispute, the UK-based hedge fund, The Children's Investment Fund Management (TCI), the biggest foreign investor in Coal India (CIL), on Friday asked the directors of the coal major to take steps for the removal of the chairman and managing director, S Narsing Rao (an AP cadre IAS officer) in order to run the company efficiently in the wake of fuel supply dispute between the power giant NTPC and CIL.
"If the current CMD is not able to provide solutions to these problems, then it is incumbent on CIL's other directors to remove him from office and take appropriate steps to have him replaced with someone who is able to run the company efficiently," TCI said in a letter to CIL directors. TCI has a minority stake in the CIL. It has been accusing CIL PSU of not protecting minority shareholders' interest.
Commenting on the power major's refusal to sign the FSA with CIL for the alleged poor quality of coal, TCI said, "it is extremely bad management to allow such a key customer to become so greatly dissatisfied."
Questioning the directors role, it said, "it is also indicative of how negligently you, as directors, are doing your jobs that CIL failed to roll out a comprehensive programme for coal washing" despite knowing that washing could fetch it international prices through quality product.
Interestingly, the TCI has already initiated legal action against the PSU by filing a petition before the Kolkata High Court. Further, the Fund charged the directors of "very serious breach" of duties by not providing any assurance regarding the theft of good quality coal from its mines, raised by it".
It also said that it is a matter of concern that while CIL's major competitor Singareni Collieries Co Ltd (SCCL) (Narsing Rao was CMD of Singareni prior to joining CIL) is "selling comparable coal to power companies at a premium of 60 per cent to CIL's equivalent FSA prices", why is it that CIL is unwilling to charge such a price for its FSA coal.
The hedge fund has sought a reply to the letter from directors within seven days.
CIL-NTPC war Kolkata (Agencies): In a significant development which may result into a black out of northern and eastern India, CIL has stopped supplies to NTPC in a tit-for-tat case as the later decided to held back payment. CIL switched off fuel supplies wiping off 5,000 MW of generating capacity of NTPC from April 1, over a pitched battle among them.
While NTPC complain that CIL is supplying stones and rocks along with coal, and it is not willing to pay and withheld `1,000 crore, sources said. NTPC says mixing of stones along with coal blocks damages the equipment besides loss of energy. The company now decides to pay basing on the energy and not the weight of consignment.