Sebi moots changes in delisting norms

Sebi has proposed to the Stock Exchanges (SEs) not to allow delisting of securities of a company pursuant to a buyback of securities by the company or pursuant to a preferential allotment made by the company.

The Sebi has also proposed that no company should apply for and no SE should grant delisting of any class of securities of a company unless a period of three years has elapsed since the listing of that class of securities. Sebi has issued guidelines on delisting of securities earlier through a circular Sebi has now decided to review the existing guidelines and. has prepared draft regulations after considering suitable suggestions received from various market participants. Sebi has posted this draft regulations on its website http://www.sebi.gov.in and has invited comments on them on or before April 29, 2004.

Sebi has suggested that companies should not apply for and no SEs should grant delisting permission to those companies whose convertible instruments are outstanding. Sebi has proposed that securities of a company may be delisted from all the SEs where they are listed or from the only SE where they are listed, subject to the provisions of of these regulations, and provided that all public holders of the securities sought to be delisted are given an exit opportunity in accordance with the laid procedure.