Press Esc to close
Sunday 01 March 2015
News updated at 12:21 PM IST
Weather
Max: 31.7°C
Min : 16.9°C
In Bengaluru
clear sky

3-year disclosure must for promoter share transfer

Mumbai, Dec 7, 2012, DHNS:

The Securities and Exchange Board of India (Sebi) has said promoters of a listed company need to make their shareholding disclosures at least three years before any transfer of shares between themselves without triggering an open offer for public investors.

Sebi has made it clear that disclosure as promoters in the shareholding pattern filing is a must for at least three years to get an exemption from the open offer, even if the company has been listed for a shorter period of time. 

If the shareholding of any entity hits 25 per cent threshold limit in a listed company, it is required to make an open offer for an additional 26 per cent shares from the public shareholders of the company. 

All the same, the market regulator has said that the open offer is not triggered if the threshold is hit because of transfer of shares between two promoters, who have been listed as promoter entities in the company’s shareholding pattern filings for at least three years, besides some other conditions.

The aforementioned observations were made by Sebi in an ‘interpretive letter’ sought by a company, the Commercial Engineers and Body Builders Company Ltd which has been listed on the BSE and the NSE since October 18, 2010.

Since the company had been listed for less than three years, it had sought an “informal guidance” from Sebi on whether one of its promoters, Ajay Gupta, could transfer shares to another promoter and his father-in-law Kailash Gupta without any open offer requirements.  

“Since the company was listed in October 2010 only, the shareholding pattern in terms of the listing agreement is available only for two years. Thus, prima facie the promoters do not qualify for the inter-se transfer since they are not complying with one of the pre-requisites (mentioned as the first condition),” Sebi said.


Go to Top

Photo Gallery
Union Budget 2015-2016 viewing session at ASSOCHAM in New Delhi on Saturday...

Union Budget 2015-2016 viewing session at ASSOCHAM in New Delhi on Saturday...

Narendra Modi and other BJP members during presentation of the Union Budget 2015-16...

Narendra Modi and other BJP members during presentation of the Union Budget 2015-16...

An Indian worker carries a sack of onions at a wholesale market in Hyderabad, India...

An Indian worker carries a sack of onions at a wholesale market in Hyderabad, India...

BJP MP Kirti Azad carrying his copy of the Union Budget 2015-16 at the Parliament House...

BJP MP Kirti Azad carrying his copy of the Union Budget 2015-16 at the Parliament House...

Farmers listening to the Union budget 2015-16 speech on radio at a village in South Dinajpur...

Farmers listening to the Union budget 2015-16 speech on radio at a village in South Dinajpur...

A display board shows the share prices at the Bombay Stock Exchange...

A display board shows the share prices at the Bombay Stock Exchange...

Arun Jaitley along with MoS Finance Jayant Sinha addressing the post budget press conference...

Arun Jaitley along with MoS Finance Jayant Sinha addressing the post budget press conference...

Arun Jaitley along with MOS Finance Jayant Sinha leave Parliament after presenting the annual...

Arun Jaitley along with MOS Finance Jayant Sinha leave Parliament after presenting the annual...

Rohit Sharma and Virat Kohli embrace after defeating the UAE at their Cricket World Cup...

Rohit Sharma and Virat Kohli embrace after defeating the UAE at their Cricket World Cup...

Supporters of India's Cricket World Cup team wave the national flag during their match...

Supporters of India's Cricket World Cup team wave the national flag during their match...

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523