Thursday, April 16, 2015

SEBI relaxes Delisting Norms

The Securities and Exchange Board of India (SEBI) has brought down the timeline for delisting of companies from 137 days to 76 days. Delisting would, however, be disallowed if the promoter or a group entity sold shares six months prior to the date of the board meeting where the delisting proposal was approved. Promoters will not be allowed to sell shares until the delisting process is completed. SEBI said delisting would be considered successful only if the acquirer acquires 90 per cent of the total share capital of the company. This is in addition to at least 25 per cent of the public shareholders holding demat shares tendering shares in the reverse book building process. However, the 25 per cent rule would not apply if the acquirer and the merchant banker are able to demonstrate that they have contacted all the public shareholders about the offer in the prescribed manner

Companies with a maximum paid-up capital of`10 crore and net worth of up to `25 crore and whose shares have not been traded during the past one year, despite not being suspended, are exempt from the reverse book building process.


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