(Bloomberg) -- Religare Enterprises Ltd., whose founders stepped down from the board following accusations they siphoned funds, named an interim chief executive officer as part of a management revamp to help rebuild investor confidence in the Indian financial services firm.
The New Delhi-based company appointed Ashok Mehta, an independent director, as the interim CEO, while also naming Vikram Talwar and a former central bank official, P Vijaya Bhaskar, as independent directors. Siddharth Mehta, founder of Bay Capital Partners, will be a non-executive, non-independent director, it said in an exchange filing late Saturday.
“The changes are at the initiative of a consortium of investors with the objective of instilling the highest level of corporate governance and effective management,” according to the statement. Separately, the company will raise as much as 12 billion rupees ($186 million) via a mix of equity and debt to bolster capital and make investment in its units, it said.
Religare Enterprises and Fortis Healthcare Ltd., both founded by Malvinder and Shivinder Singh, are at the center of allegations the billionaire brothers were funneling money out of the companies. The tycoons took at least 5 billion rupees out of Fortis without board approval a year ago, Bloomberg reported Feb. 9. New York-based private equity firm Siguler Guff & Co. has filed a lawsuit in the Delhi High Court that they siphoned funds from Religare Enterprises to manage personal debt.
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The Singh brothers have resigned from the board of Religare Enterprises and have no further association with the company nor any responsibility for its management and governance, Religare said in the statement.
To contact the reporter on this story: Subhadip Sircar in Mumbai at ssircar3@bloomberg.net.
To contact the editors responsible for this story: Stanley James at sjames8@bloomberg.net, Sam Nagarajan, John McCluskey
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