sebi:WTM/RKA/CFD-DCR-II/07/2012
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Facts / Headnote
Application seeking exemption from regulations 8(1)(b) and 27(3)(d) of the SEBI (Delisting of Equity Shares) Regulations, 2009 rejected; request disposed of.
Provisions invoked
- s. 11
- s. 11(1)
- s. 11A(2)
- s. 30
- s. 31
- s. 21A
Regulations
- Reg. 25
- Reg. 8
- Reg. 27
- Reg. 8(1)
- Reg. 27(2)
- Reg. 8(1)(b)
- Reg. 27(3)
- Reg. 27(3)(d)
Holding
SEBI denied the Company's request for exemption from the requirements of obtaining 2/3rd majority approval of public shareholders by special resolution (regulation 8(1)(b)) and positive consent of at least 90% of public shareholders (regulation 27(3)(d)) for its proposed voluntary delisting.
Full text
Page 2 of 9 c) Regulation 27(3)(d)- at least 90% of the public shareholders give their positive consent in writing to delisting proposal as well as to the offer of exit price.
Page 3 of 9 Provided that the special resolution shall be acted upon if and only if the votes cast by public shareholders in favour of the proposal amount to at least two times the number of votes cast by public shareholders against it.” Reg 25: “Power of the Board to issue clarifications.
Page 4 of 9 shareholding to public to increase public shareholding to 25% to comply with the continuous listing requirements under clause 40A of the Listing Agreement. Therefore, the Company proposes to delist its shares from MSE in accordance with special provisions for small companies in the Delisting Regulations. According to the Company this is the only option available to it in view of difficulties faced by promoters. As on the date of the application, remaining 17.66% shares of Company are held by 32 public shareholders out of which one shareholder viz Tamil Nadu Industrial Corporation (TIIC) holds 15.79% shares of the Company. Majority of the 31 public shareholders are not available at their available address and their present address could not be ascertained. The Annual Reports sent to shareholders are returned undelivered in majority of the cases. In view of these circumstances, it will be difficult to obtain requisite public shareholders’ approval under regulation 8(1) (b) and 27(3) (d). The Company had also submitted that as the only public shareholder who can be contacted and negotiated for determining the exit price is TIIC, the promoters may be exempted from appointment of a merchant banker for finalizing the exit price. Further, the price finalized for the shares held by TIIC would be offered to any other public shareholder willing to sell the shares.
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Source: SecMarx — sebi:WTM/RKA/CFD-DCR-II/07/2012. 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.