sebi:WTMO/18/CFD/12/2005

SEBI · SEBI · 2004-09-29 · Madhukar, Whole-Time Member

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Facts / Headnote

Exemption granted from Regulation 10 of Chapter III of the Takeover Regulations for the proposed acquisition of 87,50,000 equity shares from TCOL

Provisions invoked

• s. 19

Regulations

• Reg. 4
• Reg. 6
• Reg. 7
• Reg. 10
• Reg. 8
• Reg. 5
• Reg. 4(2)
• Reg. 3(4)
• Reg. 8(2)
• Reg. 3
• Reg. 3(1)(e)
• Reg. 3(1)(l)
• Reg. 4(6)

Holding

SEBI granted exemption to the acquirers (TCAG and TCIM) from complying with Regulation 10 of Chapter III of the Takeover Regulations for the proposed acquisition of 87,50,000 equity shares (60%) of the target company from TCOL, as the ultimate ownership and control would remain with TCAG and there would be no change in control of the target company.

Full text

its registered office at Thomas Cook Building, Dr. D.N. Road, Mumbai – 400 001, India. The equity shares of the target company are listed on the Bombay Stock Exchange Ltd. and the National Stock Exchange Limited. 1.2 Thomas Cook AG (hereinafter referred to as ‘TCAG’), the holding company of the Thomas Cook Group, having its registered office at Zimmersmuhlenweg 55, 61440 Oberursel, Germany, has inter alia a wholly owned subsidiary by name Eurocenter Beteiligungs-und Reiservermittlung GmbH (hereinafter referred to as ‘Eurocenter’) a company incorporated as per the laws of Germany and which in turn has a wholly owned subsidiary called Thomas Cook UK (hereinafter referred to as ‘TCUK’), a company incorporated under the laws of England having its registered office at The Thomas Cook Business Park, Coningsby Road, Peterborough, PE3 8SB, England, UK. TCUK has a wholly owned subsidiary by name Thomas Cook Overseas Ltd (hereinafter referred to as ‘TCOL’), an unlisted private company incorporated under the laws of England and Wales having its registered office at The Thomas Cook Business Park, Coningsby Road, Peterborough, PE3 8SB, England, UK. TCOL owns 60% of the shares of the target company. Target company is a subsidiary of TCOL. 1.3 TCAG has another wholly owned subsidiary Thomas Cook International Markets Ltd (hereinafter referred to as ‘TCIM’) which is a company incorporated in England in August 2004 and having its registered office at The Thomas Cook Business Park, Coningsby R

2.2 The exemption with respect to the proposed indirect acquisition was sought contemplating the proposed transaction in the following three steps- (i) TCUK proposed to transfer its shareholding in TCOL to TCAG and thus, TCOL would become direct wholly owned subsidiary of TCAG. (ii) As a second step, TCAG proposed to transfer its shareholding in TCOL to TCIM in consideration of issuance of shares of TCIM to TCAG (iii) In final step TCOL proposed to transfer its 60% shareholding in target company to TCIM, thereby making target company to be direct subsidiary of TCIM. 3.0 SUBMISSIONS IN THE APPLICATION - 3.1 In the application dated 29.9.2004 the acquirers have made the following

target company and for all practical purposes all the transfers contemplated are within the Thomas Cook group. TCIM, one of the acquirers was not mentioned in the last Annual Report of the target company since it was incorporated only in August 2004. 4.0 RECOMMENDATION OF THE TAKEOVER PANEL – 4.1 The aforesaid application dated 29.9.2004 was forwarded to the Takeover Panel in terms of sub-regulation (4) of regulation 4 of the Takeover Regulations on 25.10.2004. The Takeover Panel forwarded its report dated 28.10.2004 vide letter dated 1.11.2004. In the Report, the Takeover Panel has recommended as under – “On the facts stated in the application and based on information provided therein, it appears that TCIM Ltd., who is to acquire 60% shareholding in TCIL from TCOL is incorporated on 19th August, 2004 in United Kingdom as a private limited company having issued share capital of £2 divided into 2 ordinary shares with face value of £1 each and has a single shareholder, that is, TCAG. The shares of TCIM Ltd. are not listed on any Stock Exchange. The networth of TCIM Ltd. is £2. It is, however, wholly owned subsidiary of TCAG whose paid up share capital is EUR 303,710,000 divided into 60,742,000 bearer shares with face value of EUR 5 each. Though the shareholding of the 60% shares of TCIL would change from TCOL to TCIM Ltd. as consequence of proposed restructuring, in effect the ultimate ownership and/or control would continue to remain with TCAG. TCAG and TCOL are shown as ‘Grou

Source: SecMarx — sebi:WTMO/18/CFD/12/2005. 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.