sebi:WTM/PS/23/CFD/JULY/2015
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Facts / Headnote
Interim order freezing voting rights and corporate benefits on excess promoter shareholding, prohibiting promoters/directors from dealing in securities, restraining them from holding new director positions in any listed company, and directing quarterly compliance reports, pending final order.
Provisions invoked
- s. 19
- s. 12A
Parties
- CAC Holdings Corporation
- Accel Limited
- Accel Systems Group Inc
- the Company
Holding
The Company was found non-compliant with the minimum public shareholding (MPS) requirement of 25% under Rule 19A of the SCRR, having fallen short by 0.29% after the due date of March 02, 2015, and interim directions were issued freezing excess promoter shareholding and restricting promoter/director dealings until compliance.
Full text
Page 2 of 9 b) The SCRR was amended vide notification of the Securities Contracts (Regulation) (Amendment) Rules, 2010 ('First amendment') by the Central Government dated June 04, 2010 and amended once again vide Securities Contracts (Regulation) (Second Amendment) Rules, 2010 ('Second amendment') in terms whereof Rule 19(2)(b) was amended and a new rule; Rule 19(A) was introduced to the SCRR respectively. The amended provisions of rule 19(2)(b) and the newly inserted rule 19(A) of the SCRR are reproduced below for reference: Requirements with respect to the listing of securities on a recognised stock exchange. 19 (2) ………… (b) (i) At least twenty five per cent of each class or kind of equity shares or debentures convertible into equity shares issued by the company was offered and allotted to public in terms of an offer document; or (ii) At least ten per cent of each class or kind of equity shares or debentures convertible into equity shares issued by the company was offered and allotted to public in terms of an offer document if the post issue capital of the company calculated at offer price is more than four thousand crore rupees:
Page 3 of 9 (a) which has public shareholding below ten per cent, on the date of commencement of the Securities Contracts (Regulation) (Second Amendment) Rules, 2010 shall increase its public shareholding to at least ten per cent, in the manner specified by the Securities and Exchange Board of India, within a period of three years from the date of such commencement;
Page 4 of 9 companies to comply with the minimum public shareholding requirements within the time specified in the SCRR, SEBI issued the Circular dated August 29, 2012 which specified the following additional methods to comply with the minimum public shareholding requirements: d. Rights Issues to public shareholders, with promoters/promoter group shareholders forgoing their rights entitlement. e. Bonus Issues to public shareholders, with promoters/promoter group shareholders forgoing their bonus entitlement. f. Any other method as may be approved by SEBI, on a case to case basis.
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Source: SecMarx — sebi:WTM/PS/23/CFD/JULY/2015. 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.