MUMBAI, April 9: The Bombay Stock Exchange (BSE) has issued another show-cause notice -- the third such notice after the firm was charged with withholding price sensitive information -- to Nestle India. Not satisfied with the explanation given by Nestle to its second letter, it has asked the company to clarify the resignation of its MD, D Ardeshir, once again.According to BSE officials, the company has failed to intimate the stock exchange about the agenda of its board meeting last week and the resignation of the managing director. As per the listing norms, all the companies will have to inform the exchange about the board meetings where crucial decisions are taken.
"Rumours about the resignation were going the rounds in the stock market before the company officially announced it. Even this was done after we took up the matter with the company. By that time, Nestle scrip had shown huge volatility. Several investors seem to have lost money," said an official. The company apparently claimed that it needsto inform its Swiss headquarters before announcing any decision in India.
If the exchange is not satisfied with the reply for the third show-cause notice, it is likely to suspend trading in the scrip for a particular period. Nestle officials had last week said Ardeshir's exit was a result of "irreconcilable differences" between him and Nestle SA of Switzerland. Differences had cropped up on the functioning of the company.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
