NYSE-listed UpHealth initiates felony court cases towards founding father of Glocal Healthcare Techniques

NYSE-listed UpHealth Inc has initiated felony court cases, together with a prison criticism, towards former Tripura cadre IAS officer Sabahat Sayed Azim, the founding father of Glocal Healthcare Techniques, paperwork within the ownership of businessline display.

In accordance with its filings in Indian court docket and with the Securities and Change Fee (SEC), the Delaware-based corporate claims that it has paid round ₹2,100 crore in money, inventory, and debt to procure 94.81 according to cent of Glocal, however the corporate’s former promoters and administrators are combating it from appointing its control and board nominees.

The case is being fought through UpHealth in quite a lot of felony boards, together with the Nationwide Corporate Legislation Tribunal (NCLT), the Top Courtroom of Calcutta, and ICC Arbitration.

In the meantime, the Kolkata police have additionally registered an FIR towards Azim, Glocal’s different officers, and shareholders. The criticism names Sabahat Azim, Richa Sana Azim, Gautam Chowdhury, and Dipanwita Mukherjee. UpHealth’s criticism alleges breach of agree with, dishonest, and prison conspiracy.

Background

Prior to america corporate got here into the image, Glocal’s authentic shareholders offered their stake to quite a lot of finances and traders in tranches.

At the day when UpHealth, previous referred to as GigCapital2, bought Glocal in 2020, Azim and his circle of relatives held a 31.16 p.c stake without delay. UpHealth additionally cleared a debt of $35 million (roughly ₹280 crore) when it bought a majority stake in Glocal.

UpHealth says {that a} key covenant of the gross sales and buy settlement (SPA) (clause 10.2 within the settlement) between it and Glocal’s shareholders was once that they might facilitate a complete acquisition of the Indian corporate.

Therefore, after UpHealth bought a 94.81 according to cent stake, they invoked provisions of the SPA (underneath Clause 5.2.1.b) dated October 30, 2020 to place in position a transition staff of administrators to facilitate a easy takeover of the total control of Glocal and its daily operations from the erstwhile control.

UpHealth said in its criticism that regardless of having a 94.81 according to cent stake in Glocal, it was once no longer allowed to take over the control, which amounted to dishonest and a prison breach of agree with.

“In spite of more than one non-public requests, in addition to written communications, the accused individuals didn’t permit the induction of UpHealth’s nominees at the board of Glocal (as pondered through the SPA) for a chronic duration owing to their cheating, malafide and fraudulent intentions,” the criticism states.

Written settlement

UpHealth additionally claims that Sabahat Azim claimed that following the execution of the written settlement, there was once some other ‘oral’ settlement between them declaring that “the finances infused into Glocal through UpHealth weren’t for obtaining (and taking up its control)“. It mentioned, “Those have been investments simpliciter, instead of which, UpHealth was once to take advantage of fee of ‘cheap passion’”.

UpHealth says that Glocal’s erstwhile shareholders have additionally mentioned this within the NCLT. UpHealth says Azim claimed that the Glocal stake they offered to UpHealth was once handiest as a safety for the finances infused and no longer intended to be acted upon and that he was once in a position to go back the cash with ‘cheap’ passion.

UpHealth has known as Azim’s declare of an ‘oral’ settlement as absurd and untenable and the similar was once by no means raised earlier than in any of the communications previous. UpHealth says the accused are looking to display that america corporate violated India’s International Change Control rules.

“The accused individuals, in furtherance in their fraudulent and cheating goal, have no longer handiest initiated more than one civil legislation court cases towards the complainant, in line with the claims however have additionally sought to arm-twist the control of the complainant through falsely implicating its senior managers in frivolous prison instances,” UpHealth says.

On December 23, the Calcutta Top Courtroom noticed in its order: “Prima facie, Uphealth in relation to the shareholders’ settlement (SHA) has invested a considerable amount of cash aggregating to roughly to ₹2,100 crore and it’s the unmarried biggest majority shareholder of Glocal keeping roughly 94.5 according to cent stocks while respondents being the erstwhile promoters dangle a minuscule miniscule shareholding.”

It added, “The petitioner having infused considerable finances in relation to the SHA is now being made to run from pillar to put up. The respondents have filed court cases earlier than the NCLT, Industrial Courtroom at Rajarhat, and in addition a prison criticism. Insofar as prayer is anxious, it’s submitted {that a} nominee and permitted signatory of the petitioner is already getting access to the ICICI financial institution. In view of the aforesaid, there will also be no prejudice which will also be led to to the respondents if the prayer is permitted.”

Glocal’s reaction

A reaction from Glocal CEO’s workplace mentioned, “Board and control of Glocal aren’t acutely aware of such a FIR or NCLT Order. Alternatively, we’re acutely aware of arbitration and arbitration-related court docket court cases initiated in retaliation to our felony movements commenced right here in India to give protection to the corporate’s homes and pursuits at the side of its high function of furthering the reason for reasonably priced healthcare.

The corporate added, “It’s certainly disappointing to notice that UpHealth has shared this data with you. Our disputes with UpHealth are sub-judice, and we don’t need to remark at the similar all over the pendency of the court cases.”