New Delhi: The Supreme Court on Tuesday dismissed a batch of appeals filed by minority shareholders of Bharti Telecom Limited (BTL), upholding the company’s decision to reduce its share capital and ease out individual investors.
A bench of Justices Sanjay Kumar and K Vinod Chandran said that the valuation of shares is an expert exercise and that the company had followed the due process of law under the Companies Act provision.
The matter pertains to a 2018 decision by Bharti Telecom, a closely-held company and promoter of Bharti Airtel Limited (BAL), to reduce its share capital by cancelling shares held by minority investors (representing about 1.09% of the total shareholding).
The company initially offered ₹163.25 per share. While the National Company Law Tribunal (NCLT) later increased this to ₹196.80 per share by removing a tax deduction, a group of 35 shareholders moved the apex court.
They alleged that the valuation was a “sham”, the price was “arbitrarily low”, and the notice for the meeting was “tricky”.
“We cannot but reiterate that the appellants herein are not wary investors, cautious retirees or mere speculators, but seasoned retail investors who blend in equal measure prudence with quite calculation,” the bench said rejecting the appeals.
“Far from the bullish and bearish trends that regulate the flexible share value of listed companies in a volatile market, the appellants held on to the shares of BTL; with zero listing, zero marketability, zero dividend payment, zero exit options also declining purchase offers, with the stoic resolve of a feline waiting patiently for its prey,” the bench added.
