Wednesday, 23 August 2017
Sunday, 13 August 2017
Saturday, 5 August 2017
DISCLOSURES BY LISTED ENTITIES OF DEFAULTS ON PAYMENT OF INTEREST/ REPAYMENT OF PRINCIPAL AMOUNT ON LOANS FROM BANKS / FINANCIAL INSTITUTIONS, DEBT SECURITIES, ETC
Tuesday, 1 August 2017
Action against Exclusively Listed Companies and its Promoters/Directors pending Exit Offer to the Shareholders
"Action against Exclusively Listed Companies and its Promoters/Directors pending Exit Offer to the Shareholders"
1. SEBI vide circular dated October 10, 2016, provided options to the Exclusively Listed Companies (“ELCs”) on Dissemination Board (“DB”) to raise capital for meeting the capital requirement for getting listed on the nationwide stock exchanges or to provide exit to investors. An exit mechanism for investors in such ELCs was also specified in the aforesaid circular. Further, ELCs were required to furnish the plan of action by January 09, 2017 to the Designated Stock Exchanges (DSEs), which was subsequently extended till June 30, 2017.
2. The aforesaid circular dated October 10, 2016 stipulated the following action against such ELCs, which remain non-compliant with the above timelines:
- The company, its directors, its promoters and the companies which are promoted by any of them shall not directly or indirectly associate with the securities market or seek listing for any equity shares for a period of ten years from the exit from the DB.
- Freezing of shares of the promoters/directors.
- List of the directors, promoters etc. of all non-compliant companies as available from the details of the company with NSE/BSE shall be disseminated on SEBI website and shall also be shared with other related agencies.
- Attachment of bank accounts/other assets of promoters/directors of the companies so as to compensate the investors.
3. In order to ensure that exit option is provided to the public shareholders of ELCs that are non-compliant with the provisions of the said circular dated October 10, 2016 and have not submitted plan of action to the DSEs and in order to protect the interest of investors in ELCs on DB it is hereby directed that, to begin with:-
a. Such ELCs and the Depositories shall not effect transfer, by way of sale, pledge, etc., of any of the equity shares and the corporate benefits such as dividend, rights, bonus shares, split, etc. shall be frozen, for all the equity shares, held by the promoters or directors of non-compliant Exclusively Listed Companies till the promoters of such non-compliant Exclusively Listed Companies provide an exit option to the public shareholders in compliance with SEBI circular dated October 10, 2016, as certified by the concerned Designated Stock Exchanges ;
b. The non-compliant Exclusively Listed Companies, its directors, its promoters and the companies which are promoted by any of them shall not be eligible to access the securities market for the purposes of raising capital till the promoters of such non-compliant Exclusively Listed Companies provide an exit option to the public shareholders in compliance with SEBI circular dated October 10, 2016, as certified by the concerned Designated Stock Exchanges.
c. The promoters or directors of non-compliant Exclusively Listed Companies shall not be eligible to remain or become director of any listed company till the promoters of such non-compliant Exclusively Listed Companies provide an exit option to the public shareholders in compliance with SEBI circular dated October 10, 2016, as certified by the concerned Designated Stock Exchanges.
4. For the aforesaid purposes, “Exclusively Listed Companies” refer to those companies whose equity shares were exclusively listed at a recognised stock exchange at the time of exit of such exchange and were subsequently moved to the Dissemination Board of NSE and BSE and whose shares are available for buying and selling on Dissemination Board.
5. The concerned Designated Stock Exchanges and Depositories shall co-ordinate with each other and ensure compliance of these requirements.
6. SEBI may also take any other appropriate action(s) against the promoters/directors of Exclusively Listed Companies for non-compliance with SEBI circular dated October 10, 2016.
7. This circular is issued in exercise of powers conferred under Section 11 (1) and 11(2) (j) of the Securities and Exchange Board of India Act, 1992, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market. This circular is available on SEBI website at www.sebi.gov.in.
Link of above said circular is given below -
CS Prakash Verma
Saturday, 29 July 2017
The Supreme Court yesterday dismissed the appeals of budget carrier SpiceJet challenging the Delhi High Court verdict asking it to deposit Rs 579 crore in connection with a share transfer dispute with its previous owner Kalanithi Maran. “We are rejecting (the appeals),” a bench comprising justices R F Nariman and S K Kaul said while upholding the July three judgement of the high court.
The appeals were filed in the apex court by the airline and its co-founder Ajay Singh. A division bench of the high court had asked SpiceJet to deposit the money, saying, “there is nothing worthwhile” in the petitions to show its finances were precarious or that its cash position was so stretched that it could not comply with its single judge order asking it to deposit the amount.
However, the division bench had provided it some relief by allowing it to deposit the amount in two parts. It had said that part of the amount could be secured by a cash deposit of Rs 250 crore and the balance by a bank guarantee of Rs 329 crore. SpiceJet and Singh had challenged before the division bench the July last year’s interim order passed by a single judge alleging that the court did not have the jurisdiction.
The single judge’s order had come on a civil suit by Sun TV group’s chief Kalanithi Maran and his Kal Airways. In their suit, Maran and his airline company had sought issuance of stock warrants in SpiceJet to them as per a sale purchase agreement (SPA) of 2015 which had led to the transfer of ownership of the budget carrier to Ajay Singh.
Maran and Kal Airways had alleged before the single judge that despite giving Rs 579 crore to SpiceJet, the carrier had failed to issue them the warrants or allot tranche one and two of convertible redeemable preference shares and that the amount was not utilised for paying statutory dues for which they were also facing prosecution.
Apart from ordering that the amount be deposited in the court, the single judge had also asked Spicejet and Maran to appoint an “arbitral tribunal” to decide the share transfer dispute between them in a year. The amount was to be deposited in five instalments with the first one in August 2016, the court had said.
Market regulator SEBI had earlier expressed its inability before the high court to approve the board resolution passed by SpiceJet for issue of warrants in favour of Maran and his Kal Airways. The board resolution was passed on the court’s direction.
Under the SPA, Maran and Kal Airways had transferred their entire 350,428,758 equity shares (58.46 per cent stake) in the airline to Ajay Singh. According to the SPA, Maran and Kal were to receive the redeemable warrants in return for the amount they were to give to the airline towards operating costs and debt payment, Maran had said in his plea.
SpiceJet had earlier told the high court that the change of ownership was effected as a rehabilitative measure to address the liability of Rs 2,000 crore incurred by the airline when it was under the management of Maran. It had also claimed that every penny had been utilised towards operations and discharge of liabilities.
Source of above information -
CS Prakash Verma