The Securities and Exchange Board of India (Sebi) is likely to revisit the recently-introduced delisting regulations following protests from several quarters against the stipulation that promoters planning to take their company private have to secure the consent of 25 per cent of public shareholders,
“There is one particular aspect of the new delisting. We will have a relook at it, but first we will wait for some time to see how it pans out,” Sebi chairman UK Sinha said.
Investment bankers feel the 25 per cent consent from public shareholders would pose practical difficulties and would thwart efforts by promoters to take the firm private.
The Sebi board had on November 19 approved revamped norms that aim to reduce the time taken by the delisting process by about half, from minimum 137 days at present, to make the regulatory framework more effective. “Timelines for completing the delisting process has been reduced from 137 calendar days (around 117 working days) to 76 working days,” Sebi had said. Apart from reducing the timeline, the watchdog has decided to retain the reverse book-building process for discovering the price of shares for the purpose of delisting.
“There have been instances when delisting have been successful with just two shareholders participating,” Sinha said. Sebi is keen that delisting companies should reach out to shareholders to ensure that the offer is successful.
Sebi is also looking at removing the disparity between foreign currency convertible bonds (FCCBs) and convertible bonds issued in local currency.