CA. Arun Goenka 703 Meadows, Sahar Plaza, Andheri-Kurla Road, Andheri (E) Mumbai 400 059 Phone 2838 1348 Email:goenkaarun@gmail.com Ag/tkover/sebiltr -2 May 10, 2013 Shri U.K.Sinha, The Chairman SEBI SEBI Bhavan, 3rd Floor, B Wing, Plot No. C-4A, G Block Bandra Kurla Complex Mumbai: 400051 Dear Sir, Sub. HUL Open offer Ref. Reply received from HSBC At times it is seen that the high Goodwill that the organizations enjoy make some people working for them arrogant to the extent of thinking that they can do no wrong, or commit no mistake. The same is true in this case. Contrary to one’s expectation of highest quality of work from the world renowned corporations – Unilever, Hindustan Unilever, HSBC or M/s. Lovelock & Lewes , there are mistakes and no efforts are being made to clarify them, own them , or rectify them. It is quite clear that the merchant Banker (MB) has done a shoddy work. Even while replying they have not done their work.The reply received is quite evasive and tries to shift the blame to others without either denying the facts stated by me or correcting them. It is more in the nature of someone trying to explain how the mistake was done. It is for their internal staff evaluation exercise. The public using the information is entitled to a correct & accurate information and the agency publishing it in Public domain has to accept the responsibility. Observation 1: Dividend @ 7.50 per share for the FY ending 31 March 12 Only to Unilever PLC will come to 596 Crs. (79.48*7.50) as against reported figure of Rs.556.36 Crs. My rejoinder: In the detailed reply a lot of unwanted information is given without any direct reply to the fact & mistake mentioned. My calculations & facts have not been contradicted yet the mistake has not been owned. Regardless of the source, the information given must be correct. If the reputed Auditors of such a reputed company has made mistakes, SEBI should show cause them both separately. The mistake is twofold: (i) HUL has incorrectly reported the amount of Dividend paid for the For the year ended 31st March, 2012 (ii) HSBC has reproduced those figures under a wrong Caption. That is to say even if the Figure of dividend paid to Unilever PLC was correct, payment to Unilever PLC is not payment to Unilever Group, and showing it as such in DPS is incorrect. At the pages of Annual Report referred to in the reply, a further amount of 238 Crs. Has been reported to have been paid as dividend to Subsidiaries. This has been omitted in the DPS. Observation 2: For other related parties Dividend @ 7.50 per share for the FY ending 31 March 12 will come to 255 Crs. (34*7.50). This has not been reported at all. My rejoinder: The DPS is a statutory requirement and must be respected as such. It must be an independent & complete document. Your pleas that reference has been made to Annual Reports of the Target Company cannot be accepted. Such references cannot be taken as a replacement for information required to be submitted, especially under the heads e.g. Dividend specifically mentioned. Else the DPS can be full of just references to various documents, much like the bibliography usually found at the end of a book. The omission to report substantial payout to PAC of Rs. 255 Crs. is a major mistake especially when the MB has mentioned under I.A.10 that it is reporting “ related party transactions in the course of its business with the Acquirer and members of the Unilever group” Observation 3: Exactly the same information has been copy pasted at Clause No. I.A.10 w.r.t. The Acquirer & I.B.12 w.r.t. The PAC. While giving related party transactions. My rejoinder: It is an admitted fact that The Acquirer & the PAC are 2 distinct entity. While dealing with them separately at 2 different places under 2 distinct heading (i) The Acquirer’s key Financial information & (ii)PAC key Financial information, exact relevant information must be given. Clubbing of the information and reproducing it under different headings cannot be permitted. Observation 4: Exactly the same information has been copy pasted at Clause No. I.A.12 w.r.t. The Acquirer & I.B.14 w.r.t. The PAC. While giving financial information of the respective parties. My rejoinder: Same as above under Observation 3. HSBC is not taking such observations & investors seriously. They have not bothered to give any comment on why there was no response on the telephone numbers given in the DPS or why when a mail was written to them, it was not responded to? They respond only when a copy is marked to you. In my view the following action must be taken: 1. HSBC must be directed to come out with a corrigendum with the correct information. 2. The company & its Auditors must be show caused why incorrect information has been given in the Annual Report for the target co. Hindustan Unilever Ltd. Shall appreciate your immediate action. Thanking you, Yours truly, Arun Goenka CC.