sebi:WTM/PS/IVD/47/12/2011
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Facts / Headnote
BGIL prohibited from raising further capital; BGIL, its directors and Manager (Finance) prohibited from buying, selling or dealing in securities market till further directions; Almondz Global Securities Ltd., its CEO and Head of Merchant Banking prohibited from taking up any new issue of capital; BGIL directed to call back ICDs of 12.5 crore and amounts paid to directors/relatives/associates and deposit unutilized IPO proceeds in interest-bearing escrow account, pending investigation.
Provisions invoked
- s. 19
- s. 61
Regulations
- Reg. 13
- Reg. 200
- Reg. 3(b)
- Reg. 57(2)(a)
- Reg. 64(1)
- Reg. 60(4)(a)
Parties
- Bharatiya Global Infomedia Ltd.
- Rakesh Bhatia
- Arti Bhatia
- Sanjeev Kumar Mittal
- Anil Kapoor
- Sanjay Kapoor
- Harjeet Anand
- Jaya Mishra
- Rajeev Kumar Agarwal
- Almondz Global Securities Ltd.
- Vinay Mehta
- Sanjay Dewan
Holding
SEBI prima facie found BGIL, its directors/officials and its BRLM Almondz violated ICDR, PFUTP and Merchant Banker disclosure and due-diligence obligations and, pending investigation, restrained them from the securities market and directed escrow of IPO proceeds.
Full text
Page 2 of 24 1.1. The registered office of BGIL is located at 623, Devika Tower, 6, Nehru Place, New Delhi, 110019. The IPO by the company was for 67,20,000 equity shares under the book building route, in the price band of 75 to 82 per equity share. The Book Running Lead Manager for the issue was Almondz Global Securities Ltd. (hereafter referred to a BRLM/Almondz). Registrars to the Issue was Karvy Computershare Private Limited.
Page 3 of 24 1.1.5. The price movement on the first day of listing is placed below BGIL on BSE on July 28, 2011 1.1.6. The Red Herring Prospectus dated June 28, 2011(hereinafter referred to as RHP) issued by BGIL had, in the section named as ‘Objects of the Issue’ disclosed how the proceeds from the issue of the shares were intended to be deployed and included details of various items along with the respective amounts that were to be spent on each. The main categories were purchase of offices ( 989.60 lakh), investments in Digital Post Production Studio & IT Division ( 2204.67 lakh), expansion of R&D technology Centre ( 656.73 lakh), repayment of bank borrowings (269.72 lakh) and meeting long term working capital requirements ( 505 lakh). Further, wherever applicable, the names of the specific suppliers were also identified and mentioned in the RHP and the time schedule i.e. expected month of commencement / completion for the major items specified in a separate table.
Page 4 of 24 issue proceeds as described herein are based on management estimates and various quotations received by us from different suppliers.... We may have to revise our expenditure and fund requirements as a result of variations in the cost structure, changes in the estimates and external factors, which may not be within the control of our management. In addition, the estimated dates of completion of the expansion project as described herein are based on management’s current expectations and are subject to change due to various factors, some of which may not be in our control....Further the amount that is in excess of the funds required for the objects proposed and issue expenses will be utilized for general corporate purposes, which would be in accordance with the policies of our Board made from time to time.” The RHP was dated June 28, 2011 and the final prospectus was dated July 16, 2011. The final prospectus contained the same disclosures as that of the RHP with the final figures on IPO proceeds, issue expenses etc. and as such should be read in tandem with the references to RHP.
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Source: SecMarx — sebi:WTM/PS/IVD/47/12/2011. 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.