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Reliance Industries backs Aramco chair’s board role after investor dissent

California State Teachers Retirement Fund and State Board of Administration of Florida decided to vote against the proposal, following recommendations from proxy advisory firm Glass Lewis that cited Reliance’s plan to sell a 20% stake in its oil-to-chemicals business to Saudi Aramco.

By: Bloomberg |
September 29, 2021 5:39:04 pm
Yasir Al-Rumayyan, chairman of Saudi Arabian Oil Co. (Aramco), speaks during a news conference in Dhahran, Saudi Arabia, on Sunday, Nov. 3, 2019. (Image source: Bloomberg)

Reliance Industries Ltd. defended its plan to appoint Saudi Aramco’s non-executive Chairman Yasir Al Rumayyan as an independent director of the Indian oil-to-retail conglomerate, after some shareholders decided to vote against the move.

California State Teachers Retirement Fund and State Board of Administration of Florida decided to vote against the proposal, following recommendations from proxy advisory firm Glass Lewis that cited Reliance’s plan to sell a 20% stake in its oil-to-chemicals business to Saudi Aramco.

“The appointment of H.E. Yasir Al Rumayyan has no connection with the contemplated transaction with Saudi Aramco,” Reliance said in an exchange filing Wednesday.

“Further, as approved by the shareholders, the O2C business of RIL is being spun off to a subsidiary and as per the terms of the proposed transaction, Saudi Aramco will participate in the equity of the O2C subsidiary. The O2C Subsidiary Board may have nominees of Saudi Aramco to protect its interest.”

Reliance had appointed Rumayyan as independent director from July 19 for a term of three years. The family of Reliance Chairman Mukesh Ambani, who had announced the decision at the company’s annual shareholder meeting, holds more than 50% of Reliance shares. The e-voting to ratify the appointment will end Oct. 19.

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