Sebi to get tough with companies with high promoter holding
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However, Sebi is worried over the fact that only a few companies have taken steps in the recent past to meet the requirement, although the market conditions have improved.
Some of the firms that have met the requirement in recent months include Godrej Industries, Muthoot Capital and Adani Power, while subsidiaries of a few multi-national companies have also announced plans to meet the deadline.
Among still non-compliant companies, some have said they intend to meet the deadline but no plans of action have been provided in most of the cases.
Of the total, more than 50 firms currently have a public holding of 10 per cent or below, making it difficult for them to meet the deadline, while around 30-40 companies would need to sell just one per cent or less shares to adhere to the
The public sector companies have time till August 2013 to achieve a minimum public shareholding of 10 per cent. Any action against the public sector companies would be discussed at a later stage as they have more time in hand and the minimum public shareholding limit is also lower in their case.
Also, the number of PSU firms with public shareholding of below 10 per cent as of now is less than 20, although level of non-adherence is much larger as some of them have public holding of one per cent or below.
The Sebi has provided various options over the recent months to help the companies meet minimum public shareholding criteria, by permitting options of rights/bonus issuances of shares, as also new routes like Offer for Sale (OFS) and Institutional Placement Programme (IPP).
Besides, in exceptional situations, where any company has a special difficulty in following the prescribed methods because of reasons peculiar to it, Sebi Chairman is authorised to approve a specific solution on case-to-case basis.
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