Stressed listed companies' hunt for a white knight gets Sebi boost

Pricing norms eased, conditional exemption from open offer extended

The Securities and Exchange Board of India (Sebi) has made it easier for listed companies under financial stress to find a white knight. 

The markets regulator has eased the pricing formula and waived off the open offer requirement for investments in a company with stressed assets. It, however, has kept out promoters from making such investments and has set strict eligibility criteria to prevent misuse of the relaxation.

Usually, the mandatory 26 per cent open offer and pricing formula —which is the average price for the past 26 weeks — discourage a potential financial or strategic investor from investing in