NBFCs must get RBI nod for acquisition, transfer of control
According to RBI notification no. RBI/2015-16/ 122 dt. July 09, 2015, Non-Banking Finance Companies (NBFCs) will have to give public notice of at least 30 days before effecting the sale or transfer of ownership through sale of shares, or transfer of control with or without sale of shares. Such notice will be given by the NBFC and also by the other party or parties concerned after obtaining permission of Reserve Bank of India (RBI).
- Prior written permission will be required for any takeover or acquisition of control of an NBFC,which may or may not result in change of management;
- RBI’s permission will be required in case of a change in the shareholding of an NBFC, including progressive increases over time, which will result in acquisition/ transfer of shareholding of 26 per cent or more of the paid-up equity capital of the NBFC.
- Nod not required if shareholding exceeds 26% due to buyback or capital reduction.