sebi:WTM/PS/79/CFD/FEB/2014

SEBI · SEBI · 2013-05-06 · Prashant Saran, Whole Time Member

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Facts / Headnote

Interim order direction under paragraph 17(b) modified to permit the voluntary delisting process; company directed to complete delisting on or before July 05, 2014 and report outcome within 15 days; direction to be re-imposed automatically if delisting not completed in time; directions under paragraphs 17(a), (c) and (d) to continue till delisting or MPS compliance.

Provisions invoked

• s. 19
• s. 12A
• s. 192A

Regulations

• Reg. 8(1)(d)

Parties

• Suashish Diamonds Limited
• Mr. Ashish Goenka

Holding

SEBI modified paragraph 17(b) of its interim order dated June 04, 2013 so as not to hinder the already commenced voluntary delisting process of Suashish Diamonds Limited, permitting promoter Mr. Ashish Goenka to buy public shareholders' shares in his delisting offer, subject to completion of the delisting on or before July 05, 2014.

Full text

Page 2 of 5 Limited ("DSE"). The Company has applied for voluntary delisting and obtained approval from ASE (on 31.03.2004), CSE (26.12.2006) and DSE (27.03.2008). (iv) The Company has not accessed the capital markets since the first issuance of shares in 1995. 14 shareholders constitute the promoter and promoter group as on May 20, 2013 and hold 1,85,68,800 equity shares constituting 89.43%. There are 2,269 public shareholders holding 21,94,400 equity shares constituting 10.57% of the total paid-up share capital of the Company. (v) On seeing no other ways for the Company to comply with the MPS requirement, the promoters had initiated the process of delisting of the equity shares of the Company and had been actively pursuing this exercise. (vi) The promoters want to provide exit opportunity to the public shareholders as the scrip is infrequently traded on BSE and there is not much interest in the market for the shares of a midcap diamond company. (vii) The efforts of the Company since 2006 to place its promoters' equity with institutional investors and its efforts taken in 2008 for diluting their holding did not yield any result. (viii) After the failure to increase the public shareholding, one of its promoter, Mr. Ashish Goenka, offered to acquire the public shareholding of 10.57% in order to voluntarily delist the equity shares of the Company from BSE. Though, the shareholders approved the voluntary delisting offer, the price discovered in the reverse book- building process

Page 3 of 5 was also decided to communicate and recommend the proposal for voluntary delisting proposal for approval of the shareholders of the Company through postal ballot process pursuant to section 192A of the Companies Act, 1956 and rules made thereunder and as required under the Delisting Regulations. A practising company secretary was also appointed as the scrutinizer for the postal ballot. (xii) The Company despatched postal ballot notices by June 03, 2013 based on the statement of beneficial ownership dated May 20, 2013. (xiii) The Company is in the process of finalising the terms of appointment of the merchant banker for the delisting exercise. (xiv) The interim order, especially paragraph 17(b), restrains its promoters from dealing in the Company's shares and therefore the delisting exercise would not be capable of being implemented.

Page 4 of 5 dated July 06, 2013 of the scrutinizer, wherein it is mentioned that 97.87% of the votes cast were in favour of the resolution. In terms of regulation 8(1)(d) of the Delisting Regulations, the final application for delisting should be made within one year of passing of the special resolution of the shareholders approving the delisting proposal.

Source: SecMarx — sebi:WTM/PS/79/CFD/FEB/2014. 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.