ICICI Bank Faces Criticism for Allegedly Attempting to Influence Minority Investors of I-Sec

27 Mar 2024 , 11:15 AM

ICICI Bank is under dispute for allegedly coercing minority shareholders of ICICI Securities (I-Sec) into supporting the private lender’s move to delist the broking and investment banking arm.

Shareholders of ICICI Securities stated on social media that bank executives contacted them directly and asked them to vote in support of the resolution proposing the delisting of the broking company. Lawyers and market players warned such claimed conduct might lead to regulatory oversight of the voting process.

The e-voting for ICICI Securities’ delisting began on March 22 and got over on March 26.

Under the plan of arrangement, ICICI Bank intends to delist ICICI Securities via a share swap transaction. According to the agreements, for every 100 shares held in ICICI Securities, public shareholders would get 67 shares in ICICI Bank. A number of minority shareholders have expressed opposition to the share swap ratio for delisting the firm.

On Tuesday, some ICICI Securities shareholders resorted to social media, stating they received phone calls from ICICI Bank management on this topic. These users submitted pictures of call information and WhatsApp messages from bank workers, with some claiming that executives urged them to share the one-time password (OTP) throughout the voting process.

According to certain reports, bank management reportedly encouraged ICICI Securities shareholders to provide screenshots of their vote results.

According to securities attorneys, while the laws do not specifically prohibit participants from influencing such choices, ICICI Bank may be operating in a regulatory grey area.

At around 10.28 AM, ICICI Securities was trading 0.34% higher at ₹740.55, against the previous close of ₹738.05 on NSE. On the other hand, ICIC Bank was trading 0.37% higher at ₹1,087.70 per piece on NSE.

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