The Telegraph
Since 1st March, 1999
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Market regulator on Reliance trail
Interest of investors gets top priority

New Delhi, May 7: The Securities and Exchange Board of India (Sebi) today said it would examine the corporate governance issues in Reliance Industries in the 'broader interest of investors'.

'We have received several letters from Anil Ambani on this issue.....and are doing everything to protect the interest of the investors,' Sebi chief M. Damodaran said on the sidelines of a seminar on corporate governance organised by Assocham.

Reliance vice-chairman Anil Ambani, who is locked in a high-voltage tussle with elder brother Mukesh over the way the Reliance group is run, met the Sebi chief on Friday.

Though Damodaran refused to divulge the details of Anilís letters, over the last few days, the Sebi chief had expressed his concerns over corporate governance and disclosure norms in the group.

Damodaran said officials were looking into the matter.

'I am only concerned with broader policy issues,' he added. He also termed Anilís meeting with him on Friday as 'a courtesy call'. The Sebi chief, however, refused to comment on the developments in the Reliance group companies.

Anil and his lieutenant Amitabh Jhunjhunwala have raised several issues, including the sale of IPCLís equity by Reliance Capital, a company that may come to the younger Ambani as part of a settlement between the two brothers, without making disclosures to Sebi.

Anil went to the extent of not signing the annual accounts of RIL on April 27 and later pulled cousin Nikhil Meswani into the crossfire by asserting that he was not involved in a settlement between the brothers and, in many ways, had been misleading the media on it.

When Damodaran was asked about a possible time frame within which Sebi would 'clear the cloud' on Reliance, he said 'everything would be put in the public domain.'

Commenting on the issue raised by Anil on the freedom of independent directors on the RIL board, he said the regulator could not get into what directors say at the board meetings.

'If there is some dissatisfaction regarding the manner in which a director functions, when that personís term comes up for re-election, I am sure questions will be raised at that time,' he said.

Fielding another question on what action Sebi would take when a managing director of a mega company (reference to RIL) does not sign its financial accounts due to absence of information and disclosure, he said, 'I would not get into the specific details of any company'.

On his meeting with Anil, he said, 'members of Parliament come and meet me from time to time.'

Asked if Anil met him as an MP or the managing director of RIL, he said, 'I don't think a person tells in what capacity he is meeting.'

On letters sent to him by Anil, he said several letters were sent not only to him but to others also.

'Whatever is within our regulatory framework, we will do,' he said when asked whether Sebi was examining the communications.

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