Sunday, June 28, 2009

SEBI AMENDS DELISTING NORMS

* Companies must be delisted only if the promoters hike their stake to 90 percent,or acquire at least 50 percent through a share purchase offer aimed at giving the shareholders an exit opportunity.
* Non-promoter shareholders' votes in favour of the delisting proposal should beat least two times the number of votes cast against it by them.
* Prohibited companies to use the funds gathered directly or indirectly to finance purchase of shares to facilitate an exit opportunity for the shareholders.
* A company is not allowed to delist within 3 years of issuing buy-back offer or a preferential allotment of equity.
* Promoters of the company cannot seek listing for 10 years from the date of delisting. Under the earlier guidelines, the companies could apply for relisting of shares on stock exchanges after two years of cooling period.
* The delisting offer should initiate within 55 working days from the date of the public announcement.
* In a special provision for small firms, SEBI said shares of acompany withup to Rs 10 million paid-up capital could be delisted from all exchanges, if the stock did not trade for one year. A company can be de-listed if it had 300 or less public shareholders and the paid-upvalue of these shares was not more than Rs 1 billion.

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