Markets regulator Sebi today proposed measures to provide promoters a say in the price offered to shareholders of companies that are planning to delist from stock exchanges.
The proposal is aimed at plugging loopholes in the current delisting method for companies.
Issuing a draft paper, Sebi has suggested for a price discovery as per reverse book building (RRB) method, along with considering counter offer of promoter.
Currently, if the price discovered through reverse book building is not attractive to the promoter, he may unilaterally reject the price and the whole exercise becomes futile.
The regulator has proposed that the promoter may be allowed to make counter offer to the shareholders of that class. If the counter offer is lucrative to the shareholders and if it is accepted, delisting should be treated successful.
Further, it has suggested that in case promoter(s) give a counter offer, then the counter offer price should not be less than the book value and the counter offer should be accepted by such number of public shareholders where the promoter shareholding reaches 90 per cent.
The Securities and Exchange Board of India (Sebi) has sought comments from market participants including the investors, promoters and listed companies till August 16 on the proposal and a final regulation will be put in place after taking into consideration views of the stakeholders.
During 2015-16 to 2017-18, a total of 15 companies got voluntarily delisted, by following the reverse book building process. Seven companies got delisted at the floor price and 8 firms got delisted at a premium ranging between 7.7 per cent and 242 per cent.
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