sebi:WTM/GA/128/CFD/1/07

SEBI · SEBI · 2006-10-28 · G. Anantharaman, Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Exemption granted

Provisions invoked

• s. 19

Regulations

• Reg. 4(2)
• Reg. 4
• Reg. 5
• Reg. 3(1)
• Reg. 11(2)

Holding

Exemption was granted to Abbott Capital India Ltd. from complying with regulation 11(2) of the Takeover Regulations with regard to the increase in voting rights from 61.70% to 65.14% consequent to the proposed buy-back offer of Abbott India Ltd.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ Order against M/s Abbott India Ltd Jan 25, 2007 | Orders : Orders of Chairman/Members SECURITIES AND EXCHANGE BOARD OF INDIA

1.1 Abbott India Ltd. (hereinafter referred to as the target company) is a company incorporated under the Companies Act, 1956, having its registered office at Corporate Park, Sion Trombay Road, Mumbai- 400 071. The equity shares of the target company are listed on the Bombay Stock Exchange Ltd. Abbott Capital India Ltd. (hereinafter referred to as ‘the acquirer’) is the promoter of the target company and is presently holding 61.70% of the equity shares of the target company. 2.0 APPLICATION FOR EXEMPTION 2.1 The target company has announced its plan to buy-back its shares from the shareholders and due to the said buy-back offer, the voting rights of the acquirer would increase from 61.70% to 65.14%, in case of 100% response to the said buy-back offer and the acquire not offering to sell any shares held by it in the said proposed buy-back offer. 2.2 Kotak Mahindra Capital Company Ltd., filed an application dated October 28, 2006 on behalf of the target company and the acquirer with Securities and Exchange Board of India (hereinafter referred to as SEBI) under regulation 4(2) read with regulation 3(1) (l) of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, (hereinafter referred to as the Takeover Regulations). Since, the post buy-back shareholding of acquirer may increase to a level beyond 61.70%, the exemption is sought from the applicability of regulation 11(2) of the Takeover Regulations. In the said application, the

available whilst at the same time safeguarding the interest of continuing shareholders. f. Even after buy-back of the equity shares by the target company, the voting rights of the acquirers shall remain maximum at the level of 65.14%, which meets with the requirements of the Listing Agreement with the stock exchanges where the shares of the target company are listed as the minimum public shareholding in target company shall remain at a level more than 25%. g. The price at which the buy-back is proposed is Rs. 650/- and is higher than the book value of Rs. 141.65 per share (as on November 30, 2005). 2.3 The shareholding pattern of the target company before and after the proposed acquisition is as under: Shareholders’ category Number of registered shareholders as on date of application Shareholding Before the proposed acquisition (buy-back) Shareholding After

Source: SecMarx — sebi:WTM/GA/128/CFD/1/07. 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.