Voltas chief to step down

MUMBAI, SEPT 7: In accordance with the retirement policy of the Tata group, Voltas chairman A H Tobaccowala has announced his intention t...

MUMBAI, SEPT 7: In accordance with the retirement policy of the Tata group, Voltas chairman A H Tobaccowala has announced his intention to step down from the post. Addressing the company8217;s annual general meeting held in Mumbai on Tuesday, Tobaccowala said: quot;This is the last AGM of Voltas I am chairing. I have had a very long association with the company. I look forward to a profitable and growing Voltas.quot;

Tobaccowala will turn 75 on January 17, 2000, the age set for the retirement of all Tata group directors. Tobaccowala is also expected to retire from the board of Tata Sons, the holding company of the group, as a director.

Tobaccowala was instrumental in Voltas getting into some disastrous and unprofitable diversifications like a joint venture with Pepsi, which marked the multinational8217;s entry into India, a foray into packaged fruit drinks under the Volkart and Volfruit brands 8211; both of which had to be abandoned following mounting losses 8211; and the acquisition of the ailing public sector Allwyn, whichfinally pushed Voltas into the red in 1996-97.

The AGM today was marked by employees protesting the VRS launched by the new management.

Tobaccowala said the business environment continues to be difficult both because of the prevailing industrial recession and enhanced competition. A large order of almost Rs 1,000 crore from Coal India has been instrumental in sustaining operations in difficult times, he said.

Several subsidiaries continue to perform badly and restructuring of investment in these companies is being undertaken to improve the long-term viability of Voltas, Tobaccowala said. July and August have been difficult months. However, the positive effects of restructuring and cost-reduction measures should be visible by the end of the current financial year, he said. A significant stream of income is expected to flow from the large real estate assets built up over the years, he said.

After a two-year break, the company has resumed payment of dividend and the financial results for 1998-99 show aconsiderable improvement in profitability though this has largely been on account of extra-ordinary items, Tobaccowala said.

Story continues below this ad

The company8217;s manufacturing activities, he said, are now focused on airconditioning, forklifts and steel furniture combined with contract production of refrigeration equipment.

Representatives of the All India Voltas Employees Federation made known their protest against what they called the quot;unilateral actions of the managementquot; to shareholders by distributing a pamphlet explaining the situation at Voltas. Some employees were seen breaking into thunderous applause as and when the shareholders criticised the management.

Meanwhile, former managing director and chief executive officer of Larsen amp; Toubro, S D Kulkarni returned as a director on the board.