sebi:WTMN/204/CFD/8/04

SEBI · SEBI · T M Nagarajan, Whole Time Member

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Facts / Headnote

Acquirers directed to make a fresh public offer under the Delisting Guidelines, 2003 within 45 days; shares already acquired to be held in trust and re-offered under delisting guidelines with price adjustment; enquiry proceedings directed against the Merchant Banker.

Provisions invoked

Regulations

Parties

Holding

The Acquirers, being promoters already holding 74.998% of the Target Company, were directed to make a fresh public offer under the Delisting Guidelines, 2003 for the acquisition of the balance 7,42,560 equity shares within 45 days, rather than proceeding under the Takeover Regulations. The 13.932% shares already acquired through negotiated deals were to be held in trust and re-offered under the Delisting Guidelines with any price difference paid to the original shareholders.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER IN THE MATTER OF PROPOSED ACQUISITION OF THE ENTIRE BALANCE PUBLIC SHAREHOLDING IN SRP TOOLS LTD BY ANDAVAR INVESTMENTS PVT LTD AND PERSONS ACTING IN CONCERT WTMN/204/CFD/8/04 1.0 BACKGROUND 1.1  Meghraj Financial Services (India) Pvt Ltd (hereinafter referred to as “the Merchant Banker”) vide letter dated 21 August 2003 informed the Securities and Exchange Board (hereinafter referred to as “SEBI”) of its appointment as Manager to the Voluntary Offer to buy 25.002% equity shares of SRP Tools Ltd (hereinafter referred to as “th Company”) by Andavar Investments Pvt Ltd, Subramanian Investments Pvt Ltd, Valliammai Investments Pvt Ltd and Ramanath Investments Pvt Ltd (hereinafter collectively to as “the Acquirers”). Shares of the Target Company are listed only on Madras Stock Exchange (hereinafter referred to as “MSE”). Merchant Banker stated that th announcement was being made pursuant to Regulation 11 (2) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation (hereinafter referred to as “the Takeover Regulations”). 1.2 Merchant Banker vide letter dated 23 August 2003 filed with SEBI a copy of public announcement dated 20 August 2003 that appeared in newspapers on 21 August 2003. A letter of offer was subsequently filed with SEBI on 29 August 2003. 1.3 From the letter of offer it was observed that Acquirers were part of promoter group of the

1.1 Meghraj Financial Services (India) Pvt Ltd (hereinafter referred to as “the Merchant Banker”) vide letter dated 21st August 2003 informed the Securities and Exchange Board of India (hereinafter referred to as “SEBI”) of its appointment as Manager to the Voluntary Offer to buy 25.002% equity shares of SRP Tools Ltd (hereinafter referred to as “the Target Company”) by Andavar Investments Pvt Ltd, Subramanian Investments Pvt Ltd, Valliammai Investments Pvt Ltd and Ramanath Investments Pvt Ltd (hereinafter collectively referred to as “the Acquirers”). Shares of the Target Company are listed only on Madras Stock Exchange (hereinafter referred to as “MSE”). Merchant Banker stated that the public announcement was being made pursuant to Regulation 11 (2) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as “the Takeover Regulations”). 1.2 Merchant Banker vide letter dated 23rd August 2003 filed with SEBI a copy of public announcement dated 20th August 2003 that appeared in newspapers on 21st August 2003. A copy of letter of offer was subsequently filed with SEBI on 29 August 2003. 1.3 From the letter of offer it was observed that Acquirers were part of promoter group of the Target Company, holding 22,27,440 equity shares of Rs. 10/- each forming 74.998% of the paid up equity share capital of the Target Company. The offer was a voluntary one being made by Acquirers to shareholders of the Targe

· The proposed open offer was planned to enable the Acquirers to further “consolidate” their holding in the Target Company, without any minimum level of acceptance. Acquirers had undertaken to follow the procedure prescribed under the Delisting Guidelines in the event of non-promoter holding falling below 10% pursuant to the acquisition. · Had the offer been made under Delisting Guidelines and the response not resulted in non-promoter holding falling below 10%, the offer would have been

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Source: SecMarx — sebi:WTMN/204/CFD/8/04. 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.