Wednesday, December 15, 2010

CENTRE NOT IN FAVOUR OF MNCs IN INDIA DELISTING THROUGH IDR EXCHANGE OFFER

The Government is not in favour of allowing foreign companies to delist their share through an exchange offer of Indian Depository Receipts (IDRs). IDRs allow foreign companies to raise funds through Indian equities markets. The finance ministry believes the IDR channel should laid foreign companies in raising resources locally rather than become a tool for delisting, an official said.

  • Indian Depository Shares

In IDR, MNC issues shares to a depository, which issues receipts to Indian investors. Helps MNC
raise funds in India & investors take exposure

  • Minimum public shareholding rule

The recent move to have minimum 25% public float has prompted many MNCs listed in India
to mull delisting via an IDR exchange offer
  • Regulator's stand
In August, SEBI took up the MNCs' idea of delisting via IDRs; matter discussed in Corporate
Affairs Ministry, Finance Ministry.

0 comments:

Post a comment