Adamjee Insurance takeover controversy finally over
December 14, 2010
KARACHI: The long running controversy of the Adamjee Insurance takeover is finally over after the Sindh High Court (SHC) granted and dismissed the withdrawal petition of the Adamjee family.
“Yes, we have unilaterally withdrawn the case because six long years have passed without any outcome and we are no more interested in pursuing the case. This is a unilateral and unconditional decision and does not involve any financial or commercial settlement,” Ashraf Adamjee categorically said.
The controversy arose in 2002, when the shareholding of the then Muslim Commercial Bank (MCB renamed as MCB Bank) and its Pension and Provident Fund crossed 36 per cent of the total shareholding of Adamjee Insurance.
According to the petition, before the partition of the Indian sub-continent, Adamjee family was ranked among the five most prominent business families of South Asia with business interests extending from present day Pakistan to Dacca in East. At the time of partition, on Mohammad Ali Jinnah’s encouragement, the family migrated to Pakistan leaving all its assets in India at the mercy of the Indian Government.
Adamjee family was the pioneer in industrialisation in the nascent state of Pakistan. Among the industrial units that it setup was Adamjee Jute Mills. The family also setup MCB in Dacca in July 1947 and Adamjee Insurance in September 1960.
Adamjee family, having the management control of the company, filed a suit on December 09, 2005 stating that MCB was planning to take over the company with depositors’ fund of MCB, which was in violation of Banking Companies Ordinance, which does not allow banking companies to acquire more than 30 per cent shares in another company. SHC’s Divisional Bench, comprising Justice Sabihuddin and Justice Ather Saeed, heard the petition and reserved the judgment. The matter was fixed for re-hearing in 2009.
The Adamjee Family finally prayed to the court that they were now old and tired in pursuing the case and they wanted to unconditionally withdraw the same. Nadeem Ahmed of Ahmed & Qazi, the counsel of Adamjee family, said that their clients had unconditionally withdrawn their claim without any commercial or financial settlement.
The said withdrawal has brought a sigh of relief for MCB, which now has Adamjee Insurance in its fleet, as in case of the reversal of the acquisition, the MCB having sufficient weight age of Adamjee Insurance’s shareholding in its balance sheet, could have faced with serious financial issues because of the adjustment in the share’s price.
“Yes, we have unilaterally withdrawn the case because six long years have passed without any outcome and we are no more interested in pursuing the case. This is a unilateral and unconditional decision and does not involve any financial or commercial settlement,” Ashraf Adamjee categorically said.
The controversy arose in 2002, when the shareholding of the then Muslim Commercial Bank (MCB renamed as MCB Bank) and its Pension and Provident Fund crossed 36 per cent of the total shareholding of Adamjee Insurance.
According to the petition, before the partition of the Indian sub-continent, Adamjee family was ranked among the five most prominent business families of South Asia with business interests extending from present day Pakistan to Dacca in East. At the time of partition, on Mohammad Ali Jinnah’s encouragement, the family migrated to Pakistan leaving all its assets in India at the mercy of the Indian Government.
Adamjee family was the pioneer in industrialisation in the nascent state of Pakistan. Among the industrial units that it setup was Adamjee Jute Mills. The family also setup MCB in Dacca in July 1947 and Adamjee Insurance in September 1960.
Adamjee family, having the management control of the company, filed a suit on December 09, 2005 stating that MCB was planning to take over the company with depositors’ fund of MCB, which was in violation of Banking Companies Ordinance, which does not allow banking companies to acquire more than 30 per cent shares in another company. SHC’s Divisional Bench, comprising Justice Sabihuddin and Justice Ather Saeed, heard the petition and reserved the judgment. The matter was fixed for re-hearing in 2009.
The Adamjee Family finally prayed to the court that they were now old and tired in pursuing the case and they wanted to unconditionally withdraw the same. Nadeem Ahmed of Ahmed & Qazi, the counsel of Adamjee family, said that their clients had unconditionally withdrawn their claim without any commercial or financial settlement.
The said withdrawal has brought a sigh of relief for MCB, which now has Adamjee Insurance in its fleet, as in case of the reversal of the acquisition, the MCB having sufficient weight age of Adamjee Insurance’s shareholding in its balance sheet, could have faced with serious financial issues because of the adjustment in the share’s price.
