Leo Puri refuses extension, quits UTI Mutual Fund as managing director, CEO

Leo Puri, out-going MD, UTI Mutual Fund

Leo Puri has quit as managing director and chief executive officer of UTI Mutual Fund after the end of his five-year tenure as boardroom battle between Indian and foreign shareholders cast the shadow over his extension.

"As planned, I have stepped down from office today upon completion of my term," Puri told PTI.

Puri, who yesterday said that he did not want an extension as long as the board was sparring, will not be continuing at the fund house from tomorrow onwards, executives at the MF firm said.

However, T Rowe Price International, the biggest shareholder of UTI MF, wanted Puri to stay on until at least the initial public offer (IPO) of the fund house and even approached Bombay High Court on this issue.

Meanwhile, the Bombay High Court today adjourned the hearing of the petition filed by T Rowe Price to August 28 after the US-based shareholder sought more time.

The row has escalated with domestic shareholders asking regulator Sebi for more time to meet a regulatory order to reduce their stakes and also want the foreign investors to be asked to do the same.

Officials, however, said the regulator does not see merit in this demand as this particular foreign shareholder, T Rowe Price of the US, does not have cross holding in another fund house in India.

The diktat applies to some Indian shareholders only in case of UTI MF as they have their own fund houses as well.

Puri is also said to have defended the performance of the fund house during his five-year tenure, amid allegations from some quarters that the growth has been muted during his leadership.

T Rowe Price, which owns 26 per cent stake in UTI AMC, had last week approached the court seeking a direction to the finance ministry and markets regulator Sebi to prevent certain PSUs from stalling the company's bid to come up with an IPO.

In its petition, T Rowe Price had claimed that four public sector undertakings -- State Bank of India, Life Insurance Corporation, Punjab National Bank and Bank of Baroda -- were trying to stall the company's proposed IPO.

The petition had also sought implementation of Sebi's rules and regulations and to extend the term of Puri for another year to see the IPO through.

The petition had also sought a direction to the Securities and Exchange Board of India (Sebi) to ask the four domestic shareholders to bring down their stake in the fund house to 10 per cent each from the present 18.50 per cent.

Earlier in March, Sebi issued a directive that no shareholder of one asset management company can own more than 10 per cent in another, and those who own such stakes need to bring them down.