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Tag: Divestment

  • Hamtramck City Council passes resolution demanding boycott, divestment of Israel

    Hamtramck City Council passes resolution demanding boycott, divestment of Israel

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    Steve Neavling

    Hamtramck City Council is the nation’s first all-Muslim council.

    The Hamtramck City Council on Tuesday became the first city outside of California to approve a resolution endorsing a movement that advocates for boycotts and divestment to end support for Israel over its brutal attacks on Palestinians in Gaza.

    The only all-Muslim city council in the country unanimously approved the measure in support of the Boycott, Divestment, Sanctions (BDS) movement.

    The idea is to send a strong message of support to Palestinians and “to end the genocide” in Gaza, council members said at the meeting.

    The cities of Hayward and Richmond in California passed similar resolutions in January and May, respectively. But those cities targeted specific companies to boycott, while Hamtramck’s resolution went further in support of the entire BDS movement.

    Among those in support of the BDS resolution was Matthew J. Clark, a Jewish attorney and longtime member of the Jewish Voice for Peace, the largest progressive Jewish, anti-Zionist organization in the world.

    “Supporting the Palestinian people right now is of course not antisemitic,” Clark told the council. “I am a Jewish person, and I stand with the Palestinian people against the genocide going on. I oppose genocide because I’m Jewish — because my people have suffered from the Holocaust, a horrific genocide. For that reason, I say ‘never again’ to anybody, especially the Palestinian people.”

    Mayor Amer Ghalib said the time has come for the government to listen to its people.

    “Most American people are against the war, but our government of course does not listen to the concerns of the people,” Ghalib said. “It seems like we are ruled by a minority in this country, and that’s a problem. The voice of the people is not being heard.”

    Launched in 2005, the BDS movement targets businesses and institutions accused of contributing to violations of Palestinian rights as a protest to Israel’s actions in the Palestinian territories.

    In 2016, then-Michigan Gov. Rick Snyder passed an anti-BDS measure that bars the state from hiring businesses that boycott individuals or public entities of a foreign nation. The legislation, however, does not prevent cities from passing their own BDS resolutions.

    On the local level, pro-Palestinian activists set up an encampment at Wayne State University to pressure the school to end investment in Israel-connected companies. Police resorted to force to break up a similar encampment at the University of Michigan.

    Since the war began in October, Israel’s offensive in Gaza has killed more than 34,500 people.

    On May 20, the chief prosecutor of the International Criminal Court sought arrest warrants for leaders of Hamas and Israel, including Israeli Prime Minister Benjamin Netanyahu, for alleged war crimes. Netanyahu and his defense minister are accused of starving civilians, willfully “causing great suffering, or serious injury,” willfully killing and intentionally directing attacks against a civilian population.

    In Hamtramck, more than half of the population is believed to be Muslim. In January 2022, Hamtramck became the first city in the U.S. to have an all-Muslim city council.

    Hamtramck also became one of the first city councils in the nation to call for a ceasefire in October. In December, the council renamed a stretch of Holbrook Street to “Palestine Avenue” as a demonstration of solidarity with residents of Gaza.

    But the council has come under fire for its anti-LGBTQ+ rhetoric. In June 2023, the council unanimously banned the Pride flag from being flown on public property.

    Ghalib and other Hamtramck leaders also began meeting with Republicans, despite the GOP’s opposition to Muslims in the past.

    Hamtramck officials were also among the leaders of a movement to vote “uncommitted” in the Democratic primary election in February because of President Joe Biden’s support of Israel.

    Steve Neavling

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  • Sonoma State president put on leave for ‘insubordination’ for supporting Israel academic boycott, divestment

    Sonoma State president put on leave for ‘insubordination’ for supporting Israel academic boycott, divestment

    The president of Sonoma State University was placed on leave Wednesday, a day after he released a controversial campuswide message on the Israel-Hamas war that said the university would pursue “divestment strategies” and endorsed an academic boycott of Israeli universities.

    California State University Chancellor Mildred García announced the decision in a statement posted to the CSU website, saying that Sonoma State President Mike Lee was taken off the job for his “insubordination” in making the statement without “appropriate approvals.”

    Pro-Palestinian student encampment protesters celebrated when Lee released a letter to the roughly 6,000-student member Rohnert Park campus on Tuesday that met enough of their requests for activists to agree to dismantle their camp by Wednesday evening.

    “SSU Demands Met!” said a post on the SSU Students for Justice in Palestine Instagram with the caption “brick by brick, wall by wall” that showed screenshots of Lee’s letter.

    In his letter, Lee promised to pursue “divestment strategies that include seeking ethical alternatives” in consultation with pro-Palestinian activists and said he supported an academic boycott of Israel.

    “SSU will not pursue or engage in any study abroad programs, faculty exchanges, or other formal collaborations that are sponsored by, or represent, the Israeli state academic and research institutions,” Lee’s Tuesday letter said.

    Lee’s statement stood out. While other universities have recently said they will look into divesting from weapons companies, including UC Berkeley and UC Riverside, nearly all in the U.S. have rejected calls to target Israel specifically or to boycott formal exchange or research partnerships with Israeli universities.

    In rejecting such calls, the universities have cited their support of academic freedom and anti-discrimination policies. Some have also noted that a 2016 state law signed by then Gov. Jerry Brown banned giving state grants or contracts worth more than $100,000 to state universities that targeted Israel in endorsing the Boycott, Divestment and Sanctions movement.

    Lee’s statement immediately drew criticism from Jewish students, parents and community groups.

    Speaking at a Jewish Public Affairs Committee of California conference in Sacramento on Wednesday, California Lt. Gov. Eleni Kounalakis, who serves on the CSU Board of Trustees, slammed campuses for moving forward with agreements to quell protests.

    “Each campus is handling these situations in their own way with inconsistencies and frankly, sometimes coming up with agreements that they really don’t have the authority to come up with,” said Kounalakis, who spoke before Lee was put on leave.

    Kounalakis, a Democrat, said campuses were “woefully unprepared” for the recent protests.

    Gov. Gavin Newsom, who made a video appearance at the same Wednesday event to promote his plan to counter antisemitism, said last week that he did “not support divestment.”

    Assemblymember Jesse Gabriel (D-Encino) and Senator Scott Wiener (D-San Francisco), co-chairs of the California Legislative Jewish Caucus, commended García‘s decision, saying in a statement that Lee’s support of an academic boycott “was totally unacceptable and evidence that former President Lee is unfit to lead one of our great state institutions. We look forward to working with Chancellor García and the CSU Trustees to pursue a different path that will promote learning, respectful dialogue, mutual respect, inclusivity, and peace.”

    In her letter announcing that Lee would step aside, García said she was “deeply concerned” about his words.

    “Our role as educators is to support and uplift all members of the California State University. I want to acknowledge how deeply concerned I am about the impact the statement has had on the Sonoma State community, and how challenging and painful it will be for many of our students and community members to see and read,” García said. “The heart and mission of the CSU is to create an inclusive and welcoming place for everyone we serve, not to marginalize one community over another.”

    In his own letter on his departure, Lee apologized, saying he had “marginalized other members of our student population” and that “I realize the harm that this has caused, and I take full ownership of it. I deeply regret the unintended consequences of my actions.”

    “I want to be clear: The message was drafted and sent without the approval of, or consultation with, the Chancellor or other system leaders. The points outlined in the message were mine alone, and do not represent the views of my colleagues or the CSU,” Lee wrote.

    It was unclear how long Lee will be out. He has been on the job for 20 months, about half the time as interim president.

    In an interview with The Times, kinesiology professor Lauren Morimoto said she supported Lee.

    “As of now, the Academic Senate has not made a statement about Mike Lee’s announcement. However, I’m meeting with the Board of the Asian Pacific Islander American Faculty and Staff Association and we stand in solidarity with Mike Lee and the student protesters…,” said Morimoto, the former chair of the academic senate. “I will ask to be added to tomorrow’s agenda to present a resolution of support for Mike Lee and the student protesters and the demands they were able to negotiate with the university.”

    Staff writers Colleen Shalby and Mackenzie Mays contributed reporting.

    Jaweed Kaleem

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  • Wayne State faculty, staff condemn ‘racist assault’ on protesters who demanded divestment from Israel

    Wayne State faculty, staff condemn ‘racist assault’ on protesters who demanded divestment from Israel

    More than 100 faculty and staff members at Wayne State University denounced a “racist assault” on protesters demanding the school divest from companies linked to Israel.

    In an open letter this week, the employees condemned WSU President Kimberly Espy and the Board of Governors for their silence as campus police forcibly removed protesters from a Board of Governors meeting on April 26.

    The students were calling on the university to pull money from Israel-related companies as the country continues its brutal war on Hamas in Gaza.

    “We particularly condemn President Kimberly Espy and the Board of Governors, who looked on silently as a large group of mostly Arab, Muslim, and Jewish students were assaulted and violated by campus police and security,” the letter states. “The attacks embody the latest wave of racist and McCarthyite repression against students on campuses across the United States.”

    During the Board of Governors meeting, protesters began chanting, “We will not rest, until you divest.” Campus police, some in plain clothes, converged on the protesters and pushed and yanked them out of the meeting room as they linked arms and continued to chant. Video of the incident was posted on social media by Detroit Documenters.

    The board refused to consider a resolution that the Student Senate approved in November that called on WSU “to develop socially responsible criteria for our university’s investments to ensure that we are not complicit in war profiteering and investing in companies that knowingly contribute to or benefit from human rights violations in Palestine and around the world.”

    Faculty and staff were in attendance to urge the board to pass the divestment resolution, pointing out that Israel killed more than 34,000 Palestinian civilians, more than a third of whom were children, since the Hamas attack on Israel on Oct. 7.

    College students across the country are demanding universities pull money from companies that do business with Israel.

    When the board opted not to take up the divestment resolution, protesters began chanting.

    “That vote never happened,” the letter states. “As a result, students engaged in a peaceful, nonviolent protest demanding that university officials consider the Divestment Resolution.”

    The letter took aim at the swift, aggressive actions of police.

    “The President and Board looked on without emotion as the officers they oversee forcefully cleared the room of Arab, Muslim, and Jewish students, faculty, and community supporters,” the letter says. “Campus police, in violation of their own protocol, flagrantly laid their hands on female students who were doing nothing more than chanting. One student was inexplicably arrested, even though students never received any order to vacate or disperse.”

    The faculty and staff members called the police actions a “racist assault” and called for an apology.

    “We demand that President Espy and the Board of Governors issue a clear and unequivocal apology to the students, protect academic freedom, and commit to prevent police violence against students, faculty, and community members in the future,” the letter concludes. “HANDS OFF THE STUDENTS.”

    Wayne State officials didn’t immediately respond to Metro Times for comment.

    Steve Neavling

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  • Fairfax sweetens the deal for IDBI Bank

    Fairfax sweetens the deal for IDBI Bank

    Canadian billionaire Prem Watsa’s Fairfax is back in the fray bidding for IDBI Bank with a sweetened deal.

    According to highly placed sources aware of the matter Fairfax seems to have agreed for an all-cash compensation structure to acquire IDBI Bank. In addition, Watsa is said to have committed to ensure that the identity of IDBI Bank will be preserved after divestment.

    The revised offer from Fairfax is believed to have been communicated to the government officials about two weeks ago.

    Thorns removed

    “Until now, the bidders including Fairfax were hesitant to offer cash compensation and that was a contentious issue because the government usually doesn’t entertain share swap structures. If this is taken care of, the deal may tilt in favour of Fairfax,” said a senior executive aware of the matter. The improved offer comes amidst political tension between India and Canada and the sweetener extended by Fairfax could once again make it a top contender for IDBI Bank.

    Revised terms

    According to the revised offer, Fairfax India Holding, the Indian entity of the PE major, would bid for IDBI Bank. Since Fairfax is also the promoter of CSB Bank, the former may be merged into IDBI Bank once the deal is sealed, because Indian banking regulations mandate that an investor cannot be a promoter of two banks at the same time. With the market cap of IDBI Bank at ₹90,438 crore multiple times higher than CSB Bank’s ₹5,980 crore market capitalisation, sources say the revised structure would be beneficial for IDBI Bank.

    This is a departure from the earlier proposals where Fairfax intended to hold IDBI Bank as a separate entity for a few years post the acquisition and subsequently merge it with CSB Bank. “The Reserve Bank is not keen to allow parallel structures for a common promoter and with IDBI Bank being a very established entity, the government wasn’t not comfortable with the bank losing its identity,” said another senior executive aware of the transaction. Bid from Fairfax India Holding would effectively address concerns raised by the RBI and the government.

    With IDBI Bank’s stock price zooming from ₹60 a share when divestment talks were initiated to now over ₹84 a piece, it would be interesting to see if Kotak Mahindra Bank which is also reportedly in fray for IDBI Bank would be willing to match or better Watsa’s offer.

    Divestment of IDBI Bank started in October 2022 with Life Insurance Corporation of India (LIC) and the government selling 30.24 per cent stake 30.48 per cent stake respectively in the bank. Email sent to Fairfax and the finance ministry remained unanswered till press time.

    Tough to turn down?

    Prem Watsa willing offer cash compensation for IDBI Bank

    Sources say Fairfax has promised to retain IDBI Bank’s identity after divestment

    Revised deal terms said to have been communicated to finance ministry

    Divestment of IDBI Bank commenced in Oct 2022

    LIC and government to sell 30.24 per cent and 30.48 per cent stake respectively in IDBI Bank

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  • Gaja Capital, Piramal Alternatives-led consortium in race for Nainital Bank

    Gaja Capital, Piramal Alternatives-led consortium in race for Nainital Bank

    A consortium of five investors led by Gaja Capital is seen as the front-runner for Nainital Bank, a wholly owned subsidiary of Bank of Baroda.

    Piramal Alternatives, the private equity arm of Ajay Piramal-led Piramal Capital, Paragon Partners founded by Siddharth Parekh, Burman Family Holdings, the family offices of the FMCG major Dabur’s promoters, and the family office of Shiv Nadar, chairperson of HCL Technologies, are said to be part of this consortium.

    Other investors who have likely shown interest in the bank include a consortium of investors led by Faering Capital, founded by Aditya Parekh and Unity Small Finance Bank.

    Deal dynamics

    According to sources, Bank of Baroda is expected to divest 50 per cent stake in the first tranche of divestment and over time it will completely exit its investment. BoB holds 98.57 per cent stake in Nainital Bank, when it took over the bank in 1973 under distress situation.

    It is learnt that financial and legal due diligence by potential investors has been conducted. A binding proposal is expected to be submitted soon. While the finer details on pricing and valuations are not known yet, it gathered that BoB is keen to divest its stake for a premium.

    “It may not be a very steep multiple, but definitely notches over book value,” said a person with knowledge of the development. Nainital Bank’s FY23 net worth stood at ₹765 crore.

    It is also gathered that the investors who make an entry in the first tranche of divestment will have the right of first refusal when BoB decides to offload more stake from Nainital Bank.

    Apparently, at this round of divestment, consortium investors will hold less than 10 per cent stake in the bank, with a board seat each. “The RBI approval route which allows an investor to hold 9.99 per cent stake in a bank will be adhered to,” said the sources quoted above.

    Further, it is understood that the regulator also favours a consortium of investors rather than handing out the bank to one or two investors. “RBI prefers diversified ownership structure over-concentrated ownership,” said a highly placed source.

    In 2010, RBL Bank or the then Ratnakar Bank Limited was the last occasion when a bank was sold to clutch of investors. Interestingly, Gaja Capital was among the consortium investors of RBL Bank.  

    Lifting the curbs

    While Nainital Bank is licensed as a full-service bank, its operations are restricted to five states namely Uttarakhand, Uttar Pradesh, Delhi & NCR, Haryana, and Rajasthan. However, once the bid process formalizes and there is clarity on investors, it is learnt that the RBI may relook into the operative restrictions and remove the curbs.

    Union issues

    In 2018, fearing privatisation, the union of Nainital Bank moved the Delhi High Court to stall BoB’s stake sale. However, the court turned down the petition stating that ‘policy decisions involving complex economic factors’ cannot be interfered with by the courts. Since then, the union has not appealed the verdict. However, according to highly placed sources, one of the reasons why BoB is pursuing the stake sale in tranches is to appease the union and employees.

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  • Kotak vs Watsa: The battle for acquiring IDBI Bank intensifies

    Kotak vs Watsa: The battle for acquiring IDBI Bank intensifies

    It’s a two-horse race for IDBI Bank between Kotak Mahindra Bank and Prem Watsa-led Fairfax India Holdings, with both parties willing to pay a premium for acquiring a controlling stake. However, neither wants to merge IDBI Bank with their respective banks at this juncture.

    “A reasonable share of the government holding may remain in IDBI Bank for at least 2-3 years post the sale,” said a source explaining why the two bidders want to retain their existing banking entities independent of IDBI Bank.

    That said, highly placed sources say both interested investors are willing to shell out the premium expected by the government to acquire a majority stake in the bank.

    At around ₹57,000 crore of market capitalisation, IDBI Bank trades at approximately 1.3x 12-months trailing price to book valuation.

    On June 5, 2022 businessline had reported on Prem Watsa evincing interest in IDBI Bank, while on February 5 this year, we reported about Kotak’s interest in the bank. Sumitomo Mitsui Financial Group and Emirates NBD are said to be the other bidders.

    Seeking exemptions

    Kotak has proposed a structure whereby IDBI Bank would be held as its associate, with none of Kotak’s key management executives playing any role in the former.

    “The boards of IDBI Bank and Kotak Bank will not have overlaps,” said a person familiar with the matter. Once the government’s stake in IDBI Bank reduces, it may be merged with Kotak Bank. “A glide path of 3-5 years has been sought for the merger,” said the source.

    Fairfax has approached the RBI to not consider it as a promoter of IDBI Bank. “Fairfax wants to be seen as a large investor in the bank because it doesn’t want to cede control in CSB Bank or merge the two banks in the near term,” said another senior executive who didn’t want to be identified.

    As a deal sweetener, sources said: “Fairfax may extend comfort to the Government of India and Life Insurance Corporation of India (LIC) that IDBI Bank will remain a bancassurance partner for all the existing lines of businesses it has with these entities.”

    Emails sent to Kotak Mahindra Bank and Fairfax remained unanswered till press time.

    Tough call

    The exemptions sought by Kotak and Fairfax are contrary to the current regulations. The extant ownership norms do not permit an investor to hold two banks in the capacity of a promoter.

    Fairfax is the promoter of CSB Bank holding a 49.72 per cent stake. Likewise, a bank cannot invest in another bank, though an exception was made in March 2020 when the State Bank of India invested a 49 per cent stake in YES Bank.

    Tracking the divestment
    • DIPAM opened an expression of interest in IDBI Bank on October 7, 2022.
    • On January 7, 2023, it announced that it received multiple interest.
    • Presently, LIC and government hold 49.24 per cent and 45.48 per cent stake in the bank.
    • Post the sale LIC to hold 19.24 per cent and government at 15.48 per cent.
    • Data room for due diligence likely to be opened in June.
    • DIPAM may call for financial bids by September.

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  • ACLU asks top US court to review law against boycotting Israel

    ACLU asks top US court to review law against boycotting Israel

    Washington, DC — A top civil rights group in the United States has asked the Supreme Court to review a lower court’s ruling that upheld an Arkansas state law penalising companies that boycott Israel.

    The American Civil Liberties Union (ACLU) filed a petition on Thursday asking the top court to take up the case, arguing the Appeals Court decision violates the First Amendment of the US Constitution, which protects the right to free speech.

    “When a state singles out particular boycotts for special penalties, as Arkansas has done here, it not only infringes the right to boycott — it also transgresses the First Amendment’s core prohibition on content and viewpoint discrimination,” ACLU lawyers wrote in their filing.

    In June, the appeals court ruled in favour of the law, saying boycotts fall under commercial activity, not “expressive conduct” guaranteed by the First Amendment.

    The law follows similar measures passed by dozens of US states to curtail the Boycott, Divestment and Sanctions (BDS) movement, which pushes to pressure Israel through non-violent means to end abuses against Palestinians.

    Several rights groups, including Amnesty International and Human Rights Watch, have said Israel’s treatment of Palestinians amounts to apartheid.

    The Arkansas case started in 2018 when The Arkansas Times, a publication in the city of Little Rock, sued the state after refusing to sign a pledge not to boycott Israel to win an advertising contract from a public university.

    The law requires contractors that do not sign the pledge to reduce their fees by 20 percent.

    A federal district court initially dismissed the lawsuit but a three-judge appeals panel blocked the law in 2021, ruling it violates the First Amendment. In June, a full appeals court reversed the panel’s decision, essentially reviving the law.

    The Supreme Court is the final level of appeal and review in the US judicial system. If the top court refuses to take up the case, the appeals court’s decision will stand.

    The nine-seat Supreme Court has a conservative majority with three justices appointed by former President Donald Trump, a staunch supporter of Israel.

    Rights advocates have warned that anti-boycott measures do not only push to unconstitutionally silence Palestinian rights activism but also threaten free speech rights in general — and are being used to restrict boycotts of other entities, including the fossil fuel industry.

    Brain Hauss, a senior staff lawyer with the ACLU, said the June decision to uphold the anti-BDS law in Arkansas “badly misreads” legal precedents and withdraws protection for freedoms exercised by Americans for centuries.

    “Worse yet, the decision upholds the government’s power to selectively suppress boycotts that express messages with which the government disagrees,” Hauss said in a statement on Thursday.

    “The Supreme Court should take up this case in order to reaffirm that the First Amendment protects the right to participate in politically-motivated consumer boycotts.”

    Americans for Peace Now (APN), an advocacy group that describes itself as pro-Israel and pro-peace, also called on the Supreme Court to review the ruling.

    “A Supreme Court decision on this case, if it decides to take it up, could have broad repercussions in the United States and beyond,” APN President Hadar Susskind said in a statement.

    “We hope the Court discusses the matter and rules that states have no business imposing conditions on the free speech rights of individuals, organizations and companies. You may support or oppose boycotting Israel or the occupation, but as a government you must not impose your opinion on others or sanction them for their views.”

    Anti-BDS laws often restrict boycotts of Israel as well as any Israeli-occupied territories. Last year, several US states threatened sanctions against Ben & Jerry’s after the ice cream company decided to stop doing business in the occupied Palestinian West Bank.

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