meenu (cs) (416 Points)
05 March 2010Dear All,
A ltd get demerged from B ltd which is listed entity in the year 2000. Directors and promoters of both A ltd and B ltd are brothers.
Can now A ltd purchase the shares of B ltd from open market?
whether A ltd to made any disclosure regarding the same any where?
Kindly furnish your views.
J. Manivannan
(Advocate & IP)
(242 Points)
Replied 05 March 2010
In your case, before purchasing the shares by ‘A’ limited, you should be complied with the SEBI – (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.
Further, the promoter of “B’ limited is an individual, the following categories are fall in purview of definition of Promoter and Promoter group under said regulation.
(i) His spouse, parents, brothers, sisters and children;
(ii) Any company in which 26% or more of the equity share capital is held by him or by the persons mentioned in sub clause(i) is a partner or member;
(iii) Any company in which a company specified in sub-clause(ii), holds more than 50% of the equity share capital;
(iv) Any firm in which the aggregate of his holding and the holdings of persons mentioned in sub-clause (i) is more than 50% percent.
Certain disclosures need to be made depend upon the quantity shares or voting rights acquired by ‘A’ Limited.
After Purchasing, the shares ceiling limit of promoter or promoters group shall not exceed the limit as prescribed by SEBI or As per Listing Agreement.
meenu
(cs)
(416 Points)
Replied 06 March 2010
Dear Mani,
Kindly clarify the above in more detail. What all disclosures A ltd have to made in this regard under SAST,1997.
Secondly, would A ltd falls under the categaory of promoters of B ltd.
Kindly reply pls.
J. Manivannan
(Advocate & IP)
(242 Points)
Replied 08 March 2010
meenu
(cs)
(416 Points)
Replied 10 March 2010
Dear Mani,
Should A ltd don't fall under the category of Qualifying Promoters under SEBI(SAST),1997.
Regards,
Meenu
J. Manivannan
(Advocate & IP)
(242 Points)
Replied 10 March 2010
meenu
(cs)
(416 Points)
Replied 15 March 2010
Dear Mani,
Yes, A ltd is promoter of B ltd. Kindly clarify whether disclosure u/r 7(1A) of SEBI (SAST),1997 is required to be made.
The position is that presently in B ltd promoters holding is 65% . A ltd can purchase more 5% u/r 11(2). Now whether disclosure u/r 7(1A) is required to be made, where it is stated that on purchase of 2% disclosure is required to be made to target company and st. exch.
regards,
Meenu
J. Manivannan
(Advocate & IP)
(242 Points)
Replied 15 March 2010
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