Market regulator Sebi today barred merchant bank Almondz Global Securities and two of its officials from taking up new assignments related to public offers,after finding them guilty of irregularities related to PG Electroplast’s IPO in 2011.
Sebi also asked the concerned investigation officers to expeditiously complete the probes in the case where a number of other entities have also faced penal actions.
The regulator upheld its interim orders passed on December 28,2011 against these entities after giving an opportunity to them to present their case.
Sebi prohibited the merchant bank of PG Electroplast’s IPO,Almondz Global Securities,its MD and CEO Vinay Mehta and Sanjay Dewan authorised signatory of the investment bank for the due diligence certificate from “taking up any new assignments or involvement in any new issue of capital including IPO,follow-on public offer from the security market in any manner.”
“…Hereby confirm the directions issued vide the ad-interim ex-parte order dated December 28,2011 in the IPO matter of PG Electroplast,in respect of Almondz Global Securities,Sanjay Deewan and Vinay Mehta,” Sebi said.
During its probe,the regulator found lack of due
diligence on part of merchant bankers to ensure that offer documents contained all disclosures related to the company.
Sebi said PG Electroplast had suppressed several material facts in the offer documents pertaining to the company including utilisation of proceeds of issue and also made several misstatements relating to general corporate purpose.
“Almondz had not adhered to high standards of services,exercise of due diligence and proper care while acting as book running lead manager in the IPO of PG Electroplast,thereby depriving gullible investors of material information to enable them (of a) well informed decision,” Sebi noted.
PG Electroplast came out with an issue of Rs 120.65 crore at a price of Rs 210 per share in September 2011.
Earlier this month,Sebi had restrained three merchant banks and some of their senior executives from taking up new assignments related to public offers,after finding them guilty in irregularities related to IPOs of Taksheel Solutions RDB Rasayans and Brooks Laboratories in 2011.