Asian Paints deal may send wrong signals

NEW DELHI, AUG 24: Developments like Asian Paints’ bid to block the transfer of shares sold by Atul Choksey, outgoing managing director of the company, to the UK-based ICI plc will send the wrong signals to foreign direct investors, says AS Kasliwal, president of the Federation of Indian Chambers of Commerce (Ficci).

According to Kasliwal, such types of transactions will always be there in an open economy and each transaction cannot be viewed as a takeover threat. "As long as the ownership and management of a company does not get affected, this fear is not justified", he added.

Kasliwal said that prima facie such deals could not be considered as acquisitions. "If we treat such type of deals as acquisitions, then we are blocking the possibility of the Indian entrepreneur getting foreign investments".