Linde India faces critical minority shareholder vote today
Read Time:2 Minute, 55 Second
The company has sought shareholder approval for related party transactions with Praxair India worth Rs 417 crore.
- Linde seeks minority approval for Rs 417 crore deals with Praxair India
- Promoters can’t vote; majority of minority investors must approve
- Sebi and SAT ruled Linde-Praxair deals need shareholder approval
Linde, the world’s largest industrial gas supplier, faces a major shareholder test on March 5, as it seeks minority shareholder approval for Rs 417 crore worth Related Party Transactions(RPTs) with group entity Praxair India. The development assumes significance as dealings between Linde and Praxair has been a flashpoint between Linde India and its minority shareholders.
Although the promoter group owns 75 percent of the company, they will not be able to vote on the resolution. According to the Securities and Exchange Board of India (Sebi) rules, promoters or related parties cannot vote on RPT transactions, and the resolution will need the majority of minority investors to support it for it to be approved, say legal experts.
In 2018, following a global merger between Linde AG and Praxair, Linde India and Praxair India entered a joint venture and Linde initiated “business allocation protocols” through which some of the business was allocated to Praxair as a part of global arrangement.
Subsequently, investors complained, alleging Linde India was giving away high-growth business segments such as hydrogen projects through business allocation and barter exchanges to Praxair India, an unlisted company.
The allegation is that the transfers were being done without the proper minority shareholder approval. Rules call for mandatory shareholder approval in case value of RPTs exceeds 10 percent of the consolidated turnover of the company.
An email sent to Linde remained unanswered.
“In any shareholder voting pertaining to pelated party transactions(RPTs), promoters cannot vote on the resolution. For the proposal to sail through, it would need approval from majority of minority investors. The spirit of regulation is very clear: RPTs worth more than 10 percent of consolidated annual turnover need to be approved by minority shareholders. If an RPT is doing numerous small transactions, then the total value of the transactions with a particular RPT need to be aggregated to determine if it crosses the 10 percent threshold. Both Sebi and the Supreme Court have agreed with this interpretation,” said Shriram Subramanian, founder, Ingovern, a proxy advisory firm.
On February 13, Linde sought shareholder approval extending the tenure of its India managing director Milan Sadhukhan by three years. Around 42 percent of institutional investors voted against, though the resolution sailed through since promoter group voted in favour of the resolution.
On April 29, 2024, Sebi passed an interim order against Linde following complaints from investors about Linde-Praxair transactions.
Sebi ordered NSE to appoint a valuer to assess what business was being foregone by Linde India under its joint venture agreements. On July 24, the market regulator passed a confirmatory order, reiterating that the business transactions of Linde with Praxair India constituted a transfer of resources and must be valued by an independent valuer.
On December 5, 2025, the Securities Appellant Tribunal (SAT) dismissed Linde’s plea and ruled that the “business allocation protocols” being followed by it were RPTs and needed shareholder approval.
There are more than 60,000 retail investors invested in Linde whose stake is worth less than Rs 2 lakh. Shares of Linde has done well in 2026, so far, surging 12 percent since January 1.
Happy
0 %
Sad
0 %
Excited
0 %
Sleepy
0 %
Angry
0 %
Surprise
0 %
0
0
Average Rating