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Saroj Poddar has resigned as director of Gillette India in order to comply with market regulator Securities and Exchange Board of India’s (Sebi’s) public shareholding norms.
Poddar has tendered his resignation as director of the company with effect from December 26, vide his email dated December 26, Gillette said in a BSE filing on Friday.
Poddar, the founder director and chairman of Gillette, earlier disposed off 7.87% stake in the shaving products maker through the offer-for-sale (OFS) route to re-classify his group as a public shareholder in order to increase the minimum public shareholding of the company to 25% as per India’s shareholding rules.
After the reclassification of Poddar Group, Procter and Gamble (P&G) became the sole promoter in the company.
The OFS by the Poddar Group for 7.87% of their holding in Gillette was fully subscribed in the last month.
Now, Adventz chief Poddar holds the remaining 4.99% stake in the company.
Under the agreement between Poddar Group, the Indian promoters of Gillette India, and P&G, which was cleared by Sebi, P&G sold only 0.90% holding in GIL in the open market through OFS.
“It is under the Sebi guidelines that I will step down as a director of the company and our group will have no Gillette board seats,” Poddar told FE.
Accordingly Akshay, Poddar’s son, has also tendered his resignation as director of Gillette with effect from December 27. “… the said resignations shall be tabled at the meeting of the board of directors of the company which has been scheduled to be held on January 8, 2014,” according to the BSE filing.
“It was a tough decision as a lot of emotions were attached to the company,” Poddar told FE earlier, conceding that it was also a ‘tough decision’ to diluting stake to become a non-promoter in Gillette India.
“But the steps taken are for the best interest of the company,” he had said. Poddar, however, has maintained that he would not further dilute or sell out his present 4.99% stake in the company.
The sale of shares through OFS followed a prolonged regulatory battle between the promoters of Gillette India’s and Sebi. The company in 2012 proposed a three-stage plan to bring down the promoter holding to 75%, which was turned down by the capital market regulator.