sebi:WTMN/194/CFD/8/04

SEBI · SEBI · 2004-04-02 · T.M. Nagarajan, Whole Time Member

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Facts / Headnote

Report taken on record; no action under Regulations 44 and 45(6) initiated

Provisions invoked

• s. 19

Regulations

• Reg. 10
• Reg. 44
• Reg. 11(2)
• Reg. 3(1)(e)
• Reg. 3(1)(e)(i)

Parties

• Empee Distilleries Limited

Holding

The report of May 16, 2003 submitted by Empee Distilleries Ltd. regarding acquisition of share holdings in Empee Sugars and Chemicals Ltd. be taken on record, effectively condoning the omission and extending the benefit of exemption under Regulation 3(1)(e).

Full text

5. I have taken into consideration the facts and circumstances of the case and the material available on record which includes the show cause notice and the written submissions made by the acquirers.

3. A notice was issued to the acquirers on March 08, 2004 to show cause as to why one or more or all action(s) under Regulations 44 and 45(6) of the Regulations read with Sections 11 & 11B of the SEBI Act 1992, should not be initiated against them for the alleged violations of the Takeover Regulations. In response to the show cause notice, the acquirers, vide their letter dated April 02, 2004, stated inter alia, that the target company, transferor and transferee were part of the same group of companies namely, ‘Empee Group’ falling within the definition of group companies as per section 2(ef) of MRTP Act. It was stated that the omission to furnish the information about the group companies in the Annual Report of the Target company was purely out of oversight and unintentional. It was pleaded that while the non-disclosure might be condoned, the acquirer could have the benefit of the exemption under Reg. 3(1)(e) of the Takeover Regulations in respect of the acquisition. Hearing

6. In terms of Regulation 10 of the Takeover Regulations “No acquirer shall acquire shares or voting rights which (taken together with shares or voting rights, if any, held by him or by persons acting in concert with him), entitle such acquirer to exercise fifteen percent or more of the voting rights in a company, unless such acquirer makes a public announcement to acquire shares of such company in accordance with the Regulations”.

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