sebi:WTM/KMA/CFD/256/04/2010
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Facts / Headnote
Exemption granted
Provisions invoked
- s. 19
- s. 87(2)
Regulations
- Reg. 4(4)
- Reg. 11(1)
- Reg. 5
- Reg. 4(6)
Holding
The Whole Time Member granted Mr. Ashok Mehra and Mr. Chandra Prakash Mehra exemption from Regulation 11(1) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 for the proposed acquisition of 1,42,04,400 shares of Pacific Cotspin Limited pursuant to the CDR Package.
Full text
Page 2 of 6 into equity and that the promoters were to bring in Rs. 2.78 crore as equity in phases representing 36% of the expanded capital, in the following manner: i. Conversion of 11,42,440 Non-cumulative Redeemable Preference Shares of Rs. 100/- each into 1, 14, 24,400 equity shares of Rs.10/- each constituting 29.40% of the expanded share capital and 29.13% of the voting capital of the company allotted to the promoters. ii. 27,80,000 equity shares of Rs.10/- each constituting 7.15% of the expanded capital of the company to be allotted to the acquirers on preferential basis towards Rs. 2.78 Crore to be brought in by the promoters on a phased manner. 2.2 It was further stated that, pursuant to the allotment of equity shares, as per the CDR Package, the shareholding of promoter group (including the holding of the acquirers) would increase from 18.07% to 48.02% of the equity share capital and 17.81% to 47.59% of the voting rights of the target company. In view of the above, the acquirers filed the present application seeking exemption from the applicability of Regulation 11(1) of the Takeover Regulations with respect to the proposed acquisition of 1,42,04,400 [1,14,24,400 (on conversion of preference shares)+27,80,000 (on preferential allotment)] equity shares of the target company constituting 36.55% of the expanded capital of the target company, inter alia on the ground that the acquirers/promoters are not acquiring any shares in the target company and that the increase in
Page 3 of 6 approved by the CDR Cell and as minuted by the monitoring committee of CDR Empowered group” 3.0 RECOMMENDATION OF THE TAKEOVER PANEL 3.1 The aforesaid application was forwarded to the Takeover Panel in terms of Regulation 4(4) of the Takeover Regulations and the Takeover Panel, vide report dated February 8, 2010 has recommended as under: “The panel observed that the proposed acquisition of equity shares by the promoters is pursuant to the CDR Scheme and the said proposal has also been approved by the shareholders of the Company. Considering the fact that the proposed acquisition of equity shares by the promoters would be in the interest of the Company and its shareholders, the panel recommended the grant of exemption from the compliance of regulation 11(1) of the SEBI (SAST) Regulations.”
Page 4 of 6 264412 264412 Public * 10484 19691064/ 20051798 78.73/80.17 19691064/ 19691064 50.21/51.13 Total 10491 24650400/ 25011134 100.00/100.00 38854800/ 39215534 100.00/100.00 * The voting rights of Public includes 3,60,734 CRPSs (Cumulative Redeemable Preference Shares) were issued to public shareholders of the target company pursuant to the scheme of amalgamation of the target company with Salem Vanijya Private Limited and they have accrued 1.44 % voting capital of the target company due to operation of section 87(2)(b) of the Companies Act, 1956 since January 4, 2008. 4.0
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Source: SecMarx — sebi:WTM/KMA/CFD/256/04/2010. 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.