Sebi floats paper seeking to grant promoters a say in delisting prices

According to the new proposals, the promoter may now be allowed to make a counter offer to the shareholders

The Securities and Exchange Board of India (Sebi) has floated a discussion paper that seeks to grant promoters a say in the price offered to shareholders of companies headed for delisting.

Until now, shareholders had more heft in deciding the price at which shares should be tendered. Under the reverse book-building process, shareholders have an option to bid at a price higher than the floor price. 

The final price is at which the promoters’ holding reaches the threshold of 90 per cent. There is no specific formula to arrive at a discovered price, and it often happens that a small group of