Days after the Burman family made an open offer to takeover India's largest dry cell battery maker Eveready Industries, members of the Khaitan family tendered their resignations from the board on Thursday.
Aditya Khaitan and Amritanshu Khaitan stepped down from the board as non-executive director and chairman and as managing director of the company, according to an exchange filing.
The board at its meeting requested Suvamoy Saha, joint managing director of the firm, to assume the responsibilities as the MD.
Kolkata-based Eveready has been synonymous with the ubiquitous red batteries used in torchlights, clocks and remote controls. The over 100-year-old dry cell battery maker was controlled by the third generation of the Khaitan family. Eveready came into the Khaitan family's fold after the patriarch of the Williamson Magor Group and Amritanshu's grandfather, Brij Mohan Khaitan, acquired it from its American owners (the company was then known as Union Carbide) in 1994.
"As the largest shareholders of the company, the Burman Family have expressed their interest to take management control of your company and give new leadership and direction to the company, it would be appropriate for me to step down from the board," Amritanshu Khaitan said in his resignation letter to the board.
"I have and continue to believe in the intrinsic value of Brand Eveready and the vast distribution network your company enjoys. I will continue to be a long-term stakeholder in the company and participate in the future growth plans of the company," he added.
Khaitan said he is stepping down from the board on a strong footing, with the company having achieved its highest ever operating profits last year despite the challenges posed by Covid-19.
"Going forward, I hope the new leadership will deliver greater success in terms of higher top line and bottom line growth for your company and create significant value for all stakeholders of the company. I am and always will be available for any support required by the company during this period of transition," he wrote in the letter.
On Monday, the Burman family had announced an open offer, mandatory under SEBI's takeover rules, to buy a 26% equity stake in Eveready from public shareholders. Prior to this, they acquired an additional 5.26% stake in the company from the open market.
The Khaitan family's shareholding in Eveready fell to just 4.8% after the company defaulted on loan repayments, prompting lenders to sell their pledged shares.