Tag: Listing Agreement
-
Relaxation of Free Float Requirement
Earlier, on June 4, 2010, the Ministry of Finance introduced a requirement that all listed companies must have a public shareholding of 25%. This was to bring about uniformity and create a level playing field for all listed companies, and was the result of detailed deliberations that spanned several years. Although the rule was met
-
Supplemental Shareholding Disclosure Norms
In its board meeting held on August 4, 2010, SEBI introduced three changes to its norms requiring disclosure of shareholding patterns of listed companies. 1. Listing: The first change relates to companies undertaking an IPO. The current regime requires disclosure of shareholding pattern in the offer document and thereafter (after listing) on a quarterly basis
-
25% Free Float Requirement Becomes Law
More than two years following the issue of a discussion paper on the topic, the Ministry of Finance (MOF) has on June 4, 2010 amended the Securities Contracts (Regulation) Rules, 1957 to set a limit of 25% minimum public shareholding for initial listing by companies on Indian stock exchanges as well as continued listing. MOF’s
-
End to Accounting Jugglery in Mergers?! – SEBI amends listing agreement to end deviation through disclosure
SEBI has directed, vide circular dated 5th April 2010, the modification of the listing agreement focusing on certain deviations from Accounting Standards commonly carried out as part of Schemes of mergers, demergers, etc. SEBI has done this cleverly and indirectly but with apparently with more effect than it would have done it directly. It has
-
Consequences of Listing Violations
One of the usual consequences that befalls a company when it violates conditions of the listing agreement is a delisting of its shares from the stock exchanges. This is perceived to be a disincentive that deters companies from breaching listing conditions. It has recently been put to use in a more mild form by the
-
Norms on Minimum Public Float Set to Become Reality
In a post over a year ago, we had discussed that several companies were listed with differing minimum public shareholding in the past due to varying rules regarding minimum public float. These discrepancies continue to date. In order to obviate them, the Ministry of Finance had proposed imposing a uniform public float of 25%. This
-
Listing Unsecured Debt
In his recent column in the Business Standard, Somasekhar Sundaresan discusses the existence of certain ambiguities in interpreting the SEBI (Issue and Listing of Debt Securities) Regulations, 2008 and the special listing agreement for debt securities, which make it unclear whether listed corporate bonds should necessarily be secured to the full extent of the debt
-
Amendments to Equity Listing Agreement
On April 24, 2009, SEBI issued a circular amending certain provisions of the Equity Listing Agreement that all listed companies are required to comply with. The key amendments are listed below: – A uniform procedure has been created for dealing with shares that lay unclaimed after public issues; – The notice period for all corporate
-
Fairness Reports for Mergers
In a change announced last week, SEBI has amended the listing agreement making it mandatory for companies involved in merger transactions to obtain a fairness opinion. SEBI describes the highlights of this amendment as follows: “1. “Fairness Opinion” of independent merchant banker: In order to safeguard the interest of shareholders, the listed company as well
-
Legal Hurdles to Private Equity Investment
Although the flow of foreign private equity into India has been quite steady, there continue to be several ambiguities in the legal regime relating to private equity investment. Through interviews with experts, CNBC -TV18 identifies some of the issues. These include the following: 1. Governance rights: When private equity investors acquire rights in listed companies
