Press Esc to close
Sunday 23 July 2017
News updated at 2:11 AM IST

3-year disclosure must for promoter share transfer

Mumbai, Dec 7, 2012, DHNS: 21:42 IST
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
Women sizing up a painting put on display as part of an art exhibition against communalism...

Women sizing up a painting put on display as part of an art exhibition against communalism...

Full dress rehearsal of oath taking ceremony of President-elect Ram Nath Kovind...

Full dress rehearsal of oath taking ceremony of President-elect Ram Nath Kovind...

A green parrot nestled in a tree hollow, in Chennai...

A green parrot nestled in a tree hollow, in Chennai...

A Hindu devotee offering snake in Burhi Gandak river, on the eve of Sawan Amavasya...

A Hindu devotee offering snake in Burhi Gandak river, on the eve of Sawan Amavasya...

A peacock butterfly can be seen sitting inside a sunflower near Celle, Germany...

A peacock butterfly can be seen sitting inside a sunflower near Celle, Germany...

Kawad yatri waiting for their turn in a queue outside a Shiv temple in Meerut...

Kawad yatri waiting for their turn in a queue outside a Shiv temple in Meerut...

A farmer ploughs his paddy field during monsoon session at a village near Balurghat in South...

A farmer ploughs his paddy field during monsoon session at a village near Balurghat in South...

Chennaiyin FC Co-owner and actor Abhishek Bachchan reacts during a press conference...

Chennaiyin FC Co-owner and actor Abhishek Bachchan reacts during a press conference...

Exile Tibetans hold posters of the late Nobel laureate Xiaobo Liu during a prayer service...

Exile Tibetans hold posters of the late Nobel laureate Xiaobo Liu during a prayer service...

Temples submerged in flooded waters of Narmada river at Gwarighat in Jabalpur...

Temples submerged in flooded waters of Narmada river at Gwarighat in Jabalpur...

Like us on Facebook

Copyright 2017, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523
Powered by Yodasoft Technologies Pvt. Ltd.