Press Esc to close
Thursday 23 October 2014
News updated at 5:40 PM IST
Weather
Max: 0°C
Min : 0°C
In Bangalore
Sunny day

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
Hindu priest performs evening prayers called 'Aarti' on the banks of the river Yamuna...

Hindu priest performs evening prayers called 'Aarti' on the banks of the river Yamuna...

Dakshineswar Temple decorated with lights for the Kali Puja and Diwali at North 24 Pargana...

Dakshineswar Temple decorated with lights for the Kali Puja and Diwali at North 24 Pargana...

Firecrackers light up the sky as people celebrate Diwali festival in Mumbai...

Firecrackers light up the sky as people celebrate Diwali festival in Mumbai...

School students lighting earhen lamps at Tulsi Ghat in Varanasi...

School students lighting earhen lamps at Tulsi Ghat in Varanasi...

A view of decorated Madan Mohan Malviya Stadium with oil lamps during Deepwali festival...

A view of decorated Madan Mohan Malviya Stadium with oil lamps during Deepwali festival...

Illuminated Golden Temple on the eve of Diwali in Amritsar...

Illuminated Golden Temple on the eve of Diwali in Amritsar...

Children with special needs light firecrackers as they celebrate Diwali...

Children with special needs light firecrackers as they celebrate Diwali...

Border Security Force (BSF) soldiers enjoy Diwali celebrations on the eve of Diwali...

Border Security Force (BSF) soldiers enjoy Diwali celebrations on the eve of Diwali...

Hindu priests light oil lamps in a formation of the 'Swastika', a Hindu symbol of peace...

Hindu priests light oil lamps in a formation of the 'Swastika', a Hindu symbol of peace...

A Border Security Force (BSF) soldier lights sparklers on the eve of Diwali...

A Border Security Force (BSF) soldier lights sparklers on the eve of Diwali...

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