sebi:WTMO/30/CFD/07/2006

SEBI · SEBI · 2006-04-04 · T. C. Nair, Whole Time Member

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Facts / Headnote

Exemption granted from complying with regulation 10 of the Takeover Regulations for the proposed acquisition of 20,35,735 (36.35%) equity shares of Parenteral Drugs (India) Limited.

Provisions invoked

• s. 19

Regulations

• Reg. 4
• Reg. 3
• Reg. 10
• Reg. 2
• Reg. 4(2)
• Reg. 5
• Reg. 3(4)
• Reg. 3(1)

Holding

SEBI granted exemption to PDPL Holdings Pvt. Ltd. and PDPL Securities Pvt. Ltd. from complying with regulation 10 of the Takeover Regulations in respect of their proposed acquisition of 36.35% equity shares of Parenteral Drugs (India) Limited from the individual promoters.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER IN THE MATTER OF PROPOSED ACQUISITION OF EQUITY SHARES OF PARENTERAL DRUGS (INDIA) LIMITED – EXEMPTION APPLICATION FILED UNDER REGULATION 4(2) OF THE SEBI (SUBSTANTIAL ACQUISITION OF SHARES AND TAKEOVERS) REGULATIONS, 1997.  WTMO/30/CFD/07/2006 1.0 BACKGROUND - 1.1 M/s Parenteral Drugs (India) Ltd. (hereinafter referred to as ‘the target company’) is a company limited by shares incorporated under the Companies Act, 1956, having its re office at Shri Ganesh Chambers, Navlakha Crossing, Indore – 452 001, Madhya Pradesh. The equity shares of the target company are listed on the Bombay Stock Excha (BSE) and the Madhya Pradesh Stock Exchange Ltd. (MPSE). 1.2 PDPL Holdings Pvt. Ltd. and PDPL Securities Pvt. Ltd. (hereinafter collectively referred to as ‘the acquirers’) are stated to be the two private limited companies promoted, form registered under the Companies Act, 1956 by the individual promoters of the target company i.e. Shri Manohar Lal Gupta, his family members and persons acting in conce acquirers propose to acquire 20, 35,735 (36.35%) equity shares of the target company from the individual promoters. 2.0 APPLICATION FOR EXEMPTION - 2.1 Vide letter dated April 04, 2006 the acquirers, filed an application with the Securities and Exchange Board of India (SEBI) under regulation 4(2) read with regulation 3(1) (l) of t (Substantial Acquisition of Shares and Takeover) Regulations, 1997 (here

having its registered office at Shri Ganesh Chambers, Navlakha Crossing, Indore – 452 001, Madhya Pradesh. The equity shares of the target company are listed on the Bombay Stock Exchange Ltd. (BSE) and the Madhya Pradesh Stock Exchange Ltd. (MPSE). 1.2 PDPL Holdings Pvt. Ltd. and PDPL Securities Pvt. Ltd. (hereinafter collectively referred to as ‘the acquirers’) are stated to be the two private limited companies promoted, formed and registered under the Companies Act, 1956 by the individual promoters of the target company i.e. Shri Manohar Lal Gupta, his family members and persons acting in concert. The acquirers propose to acquire 20, 35,735 (36.35%) equity shares of the target company from the individual promoters. 2.0 APPLICATION FOR EXEMPTION - 2.1 Vide letter dated April 04, 2006 the acquirers, filed an application with the Securities and Exchange Board of India (SEBI) under regulation 4(2) read with regulation 3(1) (l) of the SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997 (hereinafter referred to as “the Takeover Regulations’) seeking exemption from the applicability of Regulation 10 of the Takeover Regulations with respect to the proposed acquisition of 36.35% shares in the target company from the individual promoters. Subsequently, vide letter dated 22.04.06, the acquirers made further submissions. 2.2 The acquirers have inter alia made the following submissions: - a). The shareholding of the promoter group in the target company is 85.64% out

individual promoters in their capacity as partners of the respective partnership firms will be held by these two companies (the acquirers) pursuant to the proposed acquisition. The acquirers in turn would allot their shares in the same proportion to the individual promoters of the target company. d) The acquirers are persons acting in concert for the purpose of the proposed acquisition and are “Promoters” within the meaning of the regulation 2 (1) (h) of Takeover Regulations. They do not hold any shares in the target company before the proposed acquisition. Pursuant to the proposed acquisition, the shareholding of the acquirers would increase from 0% to 36.35% of the equity shares of the target company and the holding of the promoter group would remain the same in the target company i.e. 85.64%. Thus, the holding of the promoter group is not going to be diluted or enhanced by the proposed acquisition. e). The acquisition is a private arrangement amongst the promoters and is a family affair. The shares are only changing hands from individual to private limited companies, formed, for the purpose of consolidating the shares of the individual promoters. f). The proposed acquisition is only with an objective of consolidation of the promoters holding in the target company and which would give more stability to the target company. g). The shareholding of the promoters in the acquirers would be in the same proportion in which they are holding shares in the target company and therefor

Source: SecMarx — sebi:WTMO/30/CFD/07/2006. 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.