sebi:WTMO/M/CFD/134/05

SEBI · SEBI · 2004-11-12 · Madhukar, Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Exemption granted from regulation 11(1) of the Takeover Regulations, subject to conditions

Provisions invoked

• s. 19
• s. 81

Regulations

• Reg. 7
• Reg. 4
• Reg. 11
• Reg. 11(1)
• Reg. 10
• Reg. 3(4)

Holding

SEBI granted exemption to FICON Holdings Ltd. and ACM Educational Foundation from complying with regulation 11(1) of the Takeover Regulations in respect of the proposed acquisition of 2,00,00,000 equity shares (18.5% of post-issue paid-up capital) by way of preferential allotment, subject to the condition that price calculation comply with SEBI (Disclosure & Investor Protection) Guidelines, 2000.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER IN THE MATTER OF PROPOSED ACQUISITION OF SHARES OF SOUTHERN PETROCHEMICALS INDUSTRIES CORPORATION LTD. {EXEMPTION APPLICATION FILED UNDER REGULATION 4 (2) OF THE SEBI (SUBSTANTIAL ACQUISITION OF SHARES AND TAKEOVERS) REGULATIONS, 1997}

WTMO/M/CFD/134/05 1.0 Southern Petrochemicals Industries Corporation Ltd. (hereinafter referred to as ‘the target company’) is a public limited company incorporated under the Companies Act, 1956 and having its registered office at 73 Armenia Street, Chennai 600 001. The equity shares of the target company are listed on the National Stock Exchange of India Ltd. 2.0 APPLICATION FOR EXEMPTION 2.1 The target company vide letter dated November 12, 2004 filed an application under regulation 4 of SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997 (hereinafter referred to as the ‘Takeover Regulations’) on behalf of FICON Holdings Ltd. and ACM Educational Foundation (hereinafter referred to as ‘the acquirers’) seeking exemption from complying with the provisions of regulation 10, 11(1) and 12 of Chapter III of the Takeover Regulations, in respect of the proposed acquisition of 2,00,00,000/- shares of the target company on Preferential basis at Rs. 10/- per share. ACM Educational Foundation is a part of the promoter group of the target company and is holding 1,20,000 equity shares i.e. 0.13% of the paid up equity share capital of the target company. FICON Holdings Ltd. is not holding any shares in the target company as on the date of the application. The shareholding of the promoter group after the proposed acquisition would increase from 30.05% to 43% of the paid up capital of the target company. 3.0

Rs. 375.69 crores. Infusion of share capital of Rs. 20 crores by the promoters at the critical stage of the target company is demonstrative of their commitment to the revival of the target company. iii) towards restructuring of its loan-term debt, the target company had availed the Corporate Debt Restructuring (CDR) mechanism, instituted by the Reserve Bank of India (RBI) for restoring its financial health. iv) under the CDR, in consultation with financial institutions led by Industrial Development Bank of India (IDBI) and Banks led by Indian Bank, entire secured debt portfolio of the target company has been restructured and the salient features of the CDR package sanctioned are: · restructuring of the loans with varying interest rates (4%-11% p.a.) and repayment tenors (5-12 years) including moratorium of 2-3 years and interest funding for two years beginning from the cut-off date of 1st April 2002. · cash credit facility from the working capital consortium to carry an interest rate of 6% for the two years – 2002-03 and 2003-04 and 11% p.a. thereafter. · one of the special terms and conditions subject to which the CDR package has been sanctioned is that the promoters of the company should bring in additional equity contribution of Rs. 20 crores at par, as part of the restructuring package. v) In accordance with the above requirement, the promoters have brought in the stipulated subscription of Rs. 20 crores, by way of additional contribution to the equity share capital of th

Source: SecMarx — sebi:WTMO/M/CFD/134/05. 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.