LOCK-IN GOES FOR QIB PLACEMENTS

Listed companies can now make domestic placements of shares and convertibles (excluding warrants) to Qualified Institutional Buyers (QIBs), without any lock-in period. The Highlights of scheme are as follows :

• Maximum amount under such placement to QIBs in a financial year shall be limited to 5 times of opening net worth.
• Minimum 10% is reserved for mutual funds.
• Pricing formula is same as that for preferential allotments.
• Single investor cannot get more than 50% of issue.
• Minimum two allot tees for issues up to Rs. 250 crores and minimum 5 allot tees for more than Rs. 250 crores.
• Convertible instruments can be converted within 60 months.
• No pre-placement approval required from SEBI.
• QIBs can sell freely on Stock Exchanges.