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Market regulator Securities and Exchange Board of India (Sebi) today revoked its order passed against Jolly Board and its promoters and directors for noncompliance of minimum public shareholding (MPS) requirement.
Jolly Board had promoter holding of more than 75% on June 3, the last day for meeting the MPS requirement, as the company was in the process of delisting its shares from the stock exchanges.
“...hereby revoke the directions issued vide the interim order dated June 04, 2013 against the company, Jolly Board Limited, its directors, promoters and promoter group, with immediate effect. The aforesaid direction would enable the Company/its promoter to proceed with the payments to the residual public shareholders who tender their shares during the exit period and acquire shares so offered therein,” said Prashant Saran, whole time member, Sebi today in an order.
Jolly Board during personal hearing and submissions before Sebi said that it has decided to delist the company in September 2012. The company received board approval in November 2012 and shareholder approval for delisting on January 2013.
Following which its received an in-principle approval for its proposed delisting from BSE. Pursuant to that its reverse book building (RBB) offer was open between May 27 and May 31, 2013.
The company told Sebi that that the process of completion of delisting offer was completed on June 10, 2013.
Jolly Board also told the regulator that its delisting offer was in the interest of public shareholders as the the floor price for the offer was Rs 350, discovered price was Rs 775, but the promoters accepted the exit price of Rs 1,000 per share.
When Saran pointed out the delay in start of the RBB process despite having all the approvals in place in February 2013, the company said the delay occurred as the company wanted to publish its audited financial results for the year March 2013 before opening the RB offer.
The company in its submission also said that it took extra steps to ensure that the final accounts were audited at the earliest so that the RBB was not unduly delayed. It also said that arrangement of funds was not a reason for delay as a bank guarantee for escrow account was available on March 01, 2013.
“After having examined the submissions and documents furnished by the company in
these proceedings, I am of the considered view that the company's submission that it waited to make the public announcement only after publication of its audited financial results for the year ended March 31, 2013 appears to be genuine,” said Saran.
He further said,”I am of the view that the directions imposed on the company, its directors, promoters and the promoter group vide the interim order need not continue. I am also of the opinion that this case does not warrant initiation of further action...”
