Any idea why CEO resigned?
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stock tanked 20% tdy post the CEO resignation
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Yups, i know but why did he resign? Was he forced to go or he was not happy with directors or he got greener pastures somewhere else?
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Seems there was a conference call earlier today (3:30 pm) for investors and analysts hosted by Rajiv C Modi to discuss developments. Saw that only now. Did anyone attend or got updates?
**Bangalore, September 2014:**Sasken Communication Technologies Limited [BSE: 532663 | NSE: SASKEN] is organising a conference call for investors and analysts today (Wednesday, 24 September, 2014), at 3:30 pm ISTto inform about the latest development at the company. Mr. Rajiv C Mody â Chairman and MD will host the call.
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As per Rajiv Mody (Chairman & MD), Anjan Lahiri due to some personal reason.
More here:
- Special Dividend:
Sasken Communication Technologies Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on September 29, 2014, inter alia, to consider a proposal for payment of a special dividend, if any.
- Appointment of Anjan Lahiri as Director was voted in the AGM and passed with 89.70% of votes
Vote Against Appointment of Anjan Lahiri as Director in AGM
Number of Members - 1 Votes: 155,242
Per 2013-14 AR: Shares held by Neeta Revankar: 155,242
Coincidence?
- Voting on Payment of Remuneration to Dr. Venkatesh (Director / CTO)
4 members representing 300,978 votes have been declared invalid.
25% of votes cast by 4 members seems to have been invalid.
Height of politics??
Voting on payment of remuneration to Ms. Revankar has sailed through with 100% valid votes in favor.
4). From AR: " On November 18, 2013, the Company allotted 12,00,000 convertible warrants to Ms. Ira Bhaduri in her capacity as Trustee of Lahiri Family Trust, of which Mr. Anjan Lahiri, Whole - time Director and CEO of the Company, is the Managing Trustee, on a preferential basis on such terms and conditions as contained in the Special Resolution passed by the Company through Postal Ballot on November 8, 2013. The warrant expires at the end of 18 months from the date of issue. The allottee shall be entitled for one equity share of 10 each of the Company for each such warrant at a price of120.25 each. As per the terms of allotment, 25% of the application money has been paid, which has been recorded as âmoney received against share warrantsâ and on payment of the remaining 75% of consideration, proportionate number of shares will be allotted."
Beneficial owners of the trust are his wife and daughters.
Issue price: 120.25 Date of conversion: After 22 April 2014 and before 18 months from date of allotment (Nov 2013). (From Special Resolution)
Per SHP on June 30, conversion has not happened.
For academic interest, April 23- Sep 23 is exactly 5 months.
At current price of 258, gain translates to 16.57 Crores (Remuneration in FY14 was 61.83 lakhs for 6 months and probably 90% of that amount for current FY). So he came, he saw and probably went with 17.75 crores (3.7% of company revenue)
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- Special Dividend:
Sasken Communication Technologies Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on September 29, 2014, inter alia, to consider a proposal for payment of a special dividend, if any.
- Appointment of Anjan Lahiri as Director was voted in the AGM and passed with 89.70% of votes
Vote Against Appointment of Anjan Lahiri as Director in AGM
Number of Members - 1 Votes: 155,242
Per 2013-14 AR: Shares held by Neeta Revankar: 155,242
Coincidence?
- Voting on Payment of Remuneration to Dr. Venkatesh (Director / CTO)
4 members representing 300,978 votes have been declared invalid.
25% of votes cast by 4 members seems to have been invalid.
Height of politics??
Voting on payment of remuneration to Ms. Revankar has sailed through with 100% valid votes in favor.
4). From AR: " On November 18, 2013, the Company allotted 12,00,000 convertible warrants to Ms. Ira Bhaduri in her capacity as Trustee of Lahiri Family Trust, of which Mr. Anjan Lahiri, Whole - time Director and CEO of the Company, is the Managing Trustee, on a preferential basis on such terms and conditions as contained in the Special Resolution passed by the Company through Postal Ballot on November 8, 2013. The warrant expires at the end of 18 months from the date of issue. The allottee shall be entitled for one equity share of 10 each of the Company for each such warrant at a price of120.25 each. As per the terms of allotment, 25% of the application money has been paid, which has been recorded as âmoney received against share warrantsâ and on payment of the remaining 75% of consideration, proportionate number of shares will be allotted."
Beneficial owners of the trust are his wife and daughters.
Issue price: 120.25 Date of conversion: After 22 April 2014 and before 18 months from date of allotment (Nov 2013). (From Special Resolution)
Per SHP on June 30, conversion has not happened.
For academic interest, April 23- Sep 23 is exactly 5 months.
At current price of 258, gain translates to 16.57 Crores (Remuneration in FY14 was 61.83 lakhs for 6 months and probably 90% of that amount for current FY). So he came, he saw and probably went with 17.75 crores (3.7% of company revenue)
Checking the voting patterns, Board Members like Pranab C. Mody and Krishna Jhaveri (both belong to Promoters group) got significant votes against, and such votes are held by a few. And in some cases votes are invalid, leading to suspicion it may be deliberate. Overall the Board seems to have significant internal friction, to that extent such animosity has been expressed public.
Hi Bramha,
I guess conversion hasnât happened, there is no announcement in BSE regarding the same. Yes there might be some internal friction between the board members, we need to wait for 29th Sept i guess. What i have come to know is that Anjan was brought to ramp up sales targeting services but he was unable to do it. He was very aggressive, old sales people were scared of loosing their jobs 6-8 months back, not sure what actually transpired. I think he had been sidelined much before AGM as Ashish Dhawan too sold his stake and if u pay attention to latest annual report, there is no info/letter from Anjan, only from Rajiv Mody.
I have come to know that Nita is a very rational person and her hold on board of directors is very strong, lets wait for 29th.
Hi Bramha,
Where u got this from? I checked on saskenâs website, couldnât find it. Also, any idea what did Mody say in the call?
Thanks
Ashish
**Bangalore, September 2014:**Sasken ** (Wednesday, ** ISTto â
Ashish
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Per ET print edition, Rajiv Mody has apparently said on the conference call, that the warrants to Lahiri Trust will be cancelled. Special resolution seeking approval did not have any clauses mentioned. But such nuances may have been covered elsewhere. 5% stake is sizeable and legal tussle, if any, depends on the legalese terms and personality
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I did not attend the conference call. In fact, I saw that note much later only on their web site. Not sure what went on. Per ET, Mody had a 3 hour call with Sr. Management Team and he expects that there will be no attrition.
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Neeta may be a straightforward person My comment is not about her. Rather when smart people do things that are seemingly not so smart, there would have been serious reasons behind. When I read the exact votes against matched, I felt that the person voted against knew about the outcome for sure, but yet wanted to send the message clear. What intrigued me, is the substantial invalid votes against Dr. G. Venkatest (old timer) (invalid votes are cast by smart people) and votes against / invalid votes on resolutions pertaining to Kiran Karnik, Pranab Mody, Krishna Jhaveri, it seems there are powerful people who wants to underline messages. Difference of opinion is common on board rooms but spilling over to votes does not augur well. Especially during times of uncertainity and when the company needs new directions, the supreme board in charge of vision setting indulging in petty quarrels is not good. My ex boss used to say, âNo one wins in pissing contestsâ
Just read this, article mentions that Mody is a control freak and thats why Anjan was removed but i guess if that was the case, they wont have brought Anjan in the first place.
Lets wait for 29th, as i mentioned earlier best case scenario would be huge dividends. One negative scenario one of my friends envisaged was if sasken does a stupid acquisition. I think they dint do it in 2010-11 so they wont do it now but who knows whats cooking in someoneâs head.
Thanks Ashish.
Seems one sided to me but to be fair other articles are from Promoter Management perspective.
Per this article, he was brought in for newer business opportunities and customer acquisitions. On customer acquisitions, seems he has hired some top talent, but not sure if translated on new customers.
Based on voting and news the tussles I see are (a) Mody and Lahiri did not go well (b) Lahiri and Neeta, who should have been his direct report (old timer, supported by Mody and possibly Mody loyalist) Š Neeta and Venkatesh (both old timers ⌠may be sibling rivalry) (d) some opposition to other Promoters (Pranab Mody, Jhaveri) (e) even against independent directors like Kiran Karnik (may be sidebar to Lahiri episode, as Kiran and Lahiri may have known each other for decades)
ET (print edition - not online edition) says Lahiriâs warrants will be cancelled. Lahiri invested 25% at conversion price (@ 150.25 - 12 lakhs of warrants translate to 4.5 crores & forfeiture if not converted). Not sure if he will leave it on table with out a fight.
BL article says he will continue till Dec 31. Elsewhere itâs mentioned âresigned with effect from 23rd Sepâ. If BL article is true (since they quote him), then some agreement may have been reached, before Rajiv Mody saying is warrants will be cancelled.
Insider selling happened in Sep. Not sure if itâs based on exit news whispers. Can be argued either way.
On acquisitions, Sasken has acquired a few companies in the past and had 2 JVs (one with Tata Auto components and other with IDG ventures). Both JVs did not take off and were shut down after losses.
Special dividend is more to prop up share price. Else it would have been announced earlier in AGM. Per our fellow boarded, even after AGM, Co Secretaray was not clear on it. So it was a quick reaction to prevent freefall.
I expect dividend to be around 35-40.
âOn acquisitions, Sasken has acquired a few companies in the past and had 2 JVs (one with Tata Auto components and other with IDG ventures). Both JVs did not take off and were shut down after losses.ââ> thats what the logic was given when Sasken started its first buy back and thats why i think they wont go for acquisitions to utilize cash, though it appears dividend announcement has to do definitely with share price free fall.
I too was at AGM and asked Mr Company Secretary regarding use of cash, he was non-committal, i agree but thats fine i guess, no big bang announcements were there.
As a shareholder it is very difficult to analyse the situation in a cool and collected way when there is so much stock price volatility.
Historically Mody has been nice to shareholders. Lots of dividends and stock buy back. So promoter integrity cannot be questioned.
I hope the dividend is large enough on sep29
Venkateshji
I fully concur with you on promoter integrity. I havenât come across anything negative on Mody.
However my post is not about past record, rather the future. Whatâs next? Where is the roadmap? So much is happening on Internet of Things and Automotive electronics in the tech space and sadly Sasken is floundering and closing JVs after years of losses. Have not seen any long term vision from the Management or from where the next growth engine is. Telecom has changed for ever in the past decade - itâs not just the smartphones, but an entire ecosystem built around that. The busines model has changed from monolithic manufacturers to value chains. Product lifecycles are getting shorter, industry is getting specialized into vertical layers (chips, designers, OS, other integration stacks, outsourced manufacturers, âmanufacturersâ as brand owners, integrators, apps), plethora of products and the race is more intense to âownâ the customers. Power equations have shifted, presenting opportunities and challenges alike for the established and enterprising. Sadly where is Sasken? Compare the mobile growth and company growth. And the wasted opportunity. It has its strengths in middleware / stacks. Has it transformed and reinvented itself?
Last AR talks about their success in building Satellite Phones. Good news is competency and capability exists but the bad news is where is the management vision to channelize it? Should it go to growing Smartphones or niche SatPhones?
When the company is at crossroads, a CEO is leaving in a year and Board seems to be divided and preoccupied with open bickering.
Dividend may be exciting. And the stock may be propped up. It may be yet another mediocre IT company. But the big question may still remain, âwhat happened to the edge that this company once possessedâ? Has it lost its identity and vision, amidst market distractions? Wish PE firms take this company private, reinvent and relist.
Disclosure:
No holdings as of now but you can safely assume thatâs under evaluation (as a trading bet, than a long term hold)
Bramha, Venkatesh,
I agree with both of u. So far Mr Mody has behaved gentlemanly on distributing the proceeds with shareholders but point is these proceeds in themselves have been low and current management seems to be devoid of any vision of growing the company. As Brahma said, there were and still are many avenues to grow and especially if ur current avenues are not looking lucrative, there is no harm in looking at other places.
If a suitor comes and takes the company private, that time we can expect share price to shoot up but otherwise, with current situation, we can expect only the cash in bank accounts and FCF they r generating currently, FCF which isnât growing.
Looks like investors are not happy given the muted stock reaction, with a special dividend of Rs20 post an year (FY14) where they paid Rs25 special dividend and Rs7 normal dividend.
Yeh dil mange more
Now some more money, 10.28 mn USD to be exact or roughly 20/- per share coming from arbitration:)