sebi:CO/78/CRD/11/04

SEBI · SEBI · 2004-08-23 · G N Bajpai, Chairman

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Facts / Headnote

Exemption granted from Regulations 10 and 12 of the Takeover Regulations, subject to conditions

Provisions invoked

• s. 19

Regulations

• Reg. 4
• Reg. 3
• Reg. 10
• Reg. 12
• Reg. 3(5)
• Reg. 3(4)

Holding

SEBI Chairman granted exemption to Vrindavan Services Pvt. Ltd. from complying with Regulations 10 and 12 of the Takeover Regulations for the proposed acquisition of 3,00,00,000 equity shares of Southern Iron and Steel Company Ltd. from Laxmi Machine Works Ltd., subject to a special resolution being passed by shareholders via postal ballot and completion of the transaction within 90 days.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER IN THE MATTER OF PROPOSED ACQUISITION OF SHARES OF SOUTHERN IRON AND STEEL COMPANY LIMITED (EXEMPTION APPLICATION FILED UNDER REGULATION 4 (2) OF THE SEBI (SUBSTANTIAL ACQUISITION OF SHARES AND TAKEOVERS) REGULATIONS, 1997) 1.0       BACKGROUND 1.1       Southern Iron and Steel Company Ltd. (hereinafter referred to as ‘the target company’) is a public limited company incorporated under the Companies Act, 1956, having its re office at 34 A, Kamaraj Road, Coimbatore .          The equity shares of the target company are listed on the Stock Exchange Mumbai, Madras Stock Exchange and Coi Stock Exchange Ltd. 1.2                        As the existing management could not run the target company profitably and the target company could not repay its obligations of loan liability towards banks and institutions, financial restructuring under Corporate Debt Restructuring (CDR) scheme has been initiated, under which it is proposed that one of the promoters of the target c namely Laxmi Machine Works Ltd. (hereinafter referred to as ‘LMW’) would transfer its holding of 39.71% of the equity capital in the target company to  Vrindavan Services (hereinafter referred to as ‘the acquirer’) and persons acting in concert namely Jindal South West Groups and its associates. Based on the proposals made by LMW, ‘the a showed its interest to acquire the entire shareholding of 39.71% of LMW in the target company.  

1.0 BACKGROUND 1.1 Southern Iron and Steel Company Ltd. (hereinafter referred to as ‘the target company’) is a public limited company incorporated under the Companies Act, 1956, having its registered office at 34 A, Kamaraj Road, Coimbatore . The equity shares of the target company are listed on the Stock Exchange Mumbai, Madras Stock Exchange and Coimbatore Stock Exchange Ltd. 1.2 As the existing management could not run the target company profitably and the target company could not repay its obligations of loan liability towards banks and financial institutions, financial restructuring under Corporate Debt Restructuring (CDR) scheme has been initiated, under which it is proposed that one of the promoters of the target company namely Laxmi Machine Works Ltd. (hereinafter referred to as ‘LMW’) would transfer its holding of 39.71% of the equity capital in the target company to Vrindavan Services Pvt. Ltd. (hereinafter referred to as ‘the acquirer’) and persons acting in concert namely Jindal South West Groups and its associates. Based on the proposals made by LMW, ‘the acquirer’ showed its interest to acquire the entire shareholding of 39.71% of LMW in the target company. 2.0 APPLICATION FOR EXEMPTION 2.1 ‘The acquirer’ made an application dated August 23, 2004 under clause (l) of sub-regulation (1) of regulation 3 of SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997 (hereinafter referred to as the ‘Takeover Regulations’) seeking exemption from the applic

XIII of SEBI (Disclosure & Investor Protection) Guidelines, 2000, which ever is higher, to the tune of Rs. 120 crores. 2.2 As per the said application, the current shareholding pattern of the target company, is as under: Shareholder Equity shares Preference shares Value % Value % LMW 30.00 39.71 44.95 52.98 TIDCO 8.25 10.93 9.90 11.67 ICICI Bank 0.00 0.00 30.00 35.35 Public

Source: SecMarx — sebi:CO/78/CRD/11/04. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.