Godfrey Phillips India shareholders reject proposal to sell unmanufactured tobacco to Philip Morris Products
Shareholders of Godfrey Phillips India have rejected the company's proposal for a related party transaction to annually export unmanufactured tobacco worth up to Rs 1,000 crore to Philip Morris Products SA. Philip Morris Products SA is a member entity of the group to which Philip Morris Global Brands Inc, USA — a promoter shareholder of the company.
As many as 57.94 per cent of the shareholders present at Godfrey Phillips India's annual general meeting on September 1 voted against the «material related party transaction between the company and Philip Morris Products SA».
The proposal was to continue supplying unmanufactured tobacco to Philip Morris Products SA on an arm's length pricing and non-exclusive basis, subject to the condition that the aggregate value of the sale/export of the unmanufactured tobacco is up to Rs 1,000 crore in a financial year.
The resolution was supported by only 42.06 per cent of the total votes polled in the AGM.
An ordinary resolution is passed by a simple majority. However, it received less than the required number of the total votes polled, hence, it was rejected, according to a Scrutinizer's Report shared by the company to the bourses last week.
For the quarter ending June 2023, Philip Morris Global Brands Inc, which owns cigarette brands including — Marlboro, Benson & Hedges — has 25.10 per cent of the equity share of Godfrey Phillips India.
The approval was sought by Godfrey Phillips India following Regulation 23 of the market regulator Sebi's Listing Regulations, which mandates that if any transaction with a related party during a financial year exceeds Rs 1,000 crore or 10 per cent of the annual consolidated turnover as per the last audited financial statements, requires prior approval
