Seven Islands Shipping Ltd has stepped down from the membership of Indian National Shipowners Association (INSA). The shipping company is backed by Fairfax India Holdings Corporation.
In a related development, Anil Devli has also resigned from the post of Chief Executive Officer of INSA. Anil Devli quit last month, after the board of the lobby group (INSA) asked him to “explain” his decision to take up a Director seat on the board of Seven Islands Shipping, multiple sources revealed.
The board of INSA, according to the sources, felt that Devli’s decision to join the board of Seven Islands, a member of INSA, would lead to a “conflict of interest” scenario.
“Devli was asked to choose between INSA, and Seven Islands and he chose Seven Islands,” said a source familiar with the matter, asking not to be named. Devli’s resignation was accepted by the board of INSA during a meeting held in July.
Last week, Seven Islands wrote to INSA of its decision to quit the membership of the group, citing “internal reasons”. The move is seen as a “protest” against the INSA board’s decision asking Devli to explain his directorship at Seven Islands, the sources said.
The departure of Seven Islands, India’s second biggest private oil tanker shipping company, from INSA, is a second blow to the lobby group after State-owned Shipping Corporation of India Ltd (SCI), a heavyweight member, left the group sometime in 2020.
Devli joined the board of Seven Islands as an independent director in August 2021 and the move had led to “concerns” among some INSA board members, particularly over the so-called right of first refusal (RoFR) available to Indian fleet owners for hauling crude and petroleum products owned by State-owned oil firms.
To be sure, Devli was an independent director on the board of marine services company Ocean Sparkle Ltd, also a member of INSA, for many years till it was acquired by Adani Ports and Special Economic Zone Ltd (APSEZ) in May this year.
“That was a pre-existing directorship before he was appointed as CEO of INSA. Devli had disclosed this at the time of his appointment, and he was allowed to continue as director on the board of Ocean Sparkle. But, accepting a directorship on the board of Seven Islands is seen as a complete conflict of interest,” the sources said. Unlike in the case of Ocean Sparkle, a marine services firm where the right of first refusal is not intensely sought after due to the lack of a large number of players, the RoFR is critical for INSA member firms in the main shipping business.
