(1) Anything done or omitted to be done or any right, privilege, obligation or liability acquired or accrued or incurred under Securities and Exchange Board of India (Delisting of Securities) Guidelines, 2003 prior to the commencement of these regulations shall be governed by said guidelines.
90[(2) Any proposal for delisting made by company or any promoter or acquirer who wanted to delist securities of the company, prior to commencement of these regulations and where the offer price has not been determined in terms of sub- regulation (1) of regulation 15 as on the date of such commencement, shall be proceeded with under the 91[Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, as amended from time to time].
(3) The remaining procedures in respect of an exit opportunity already completed or an exit opportunity initiated but not completed under the Securities and Exchange Board of India (Delisting of Securities) Guidelines, 2003 prior to commencement of these regulations, shall be completed and the application for delisting made pursuant thereto shall be dealt under the said guidelines.
SCHEDULE I [See regulation 10(2)] CONTENTS OF THE PUBLIC ANNOUNCEMENT
1. The floor price and the offer price and how they were arrived at.
2. The dates of opening and closing of the offer.
3. The name of the exchange from which the equity shares are sought to be delisted.
4. The manner in which the offer can be accepted by the shareholders.
89 Substituted for the title “Transitional provisions” by the SEBI (Delisting of Equity Shares) (Second Amendment) Regulations, 2018, w.e.f. 14.11.2018.
90 Substituted by the SEBI (Delisting of Equity shares) (Amendment) Regulations 2015, w.e.f. 24-03-2015.
91 Substituted for “Securities and Exchange Board of India (Delisting of Equity) Regulations, 2009 as amended by the Securities and Exchange Board of India (Delisting of Equity Shares) Amendment) Regulations, 2015” by the SEBI (Delisting of Equity Shares) (Second Amendment) Regulations, 2018, w.e.f. 14.11.2018.
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5. Disclosure regarding the minimum acceptance condition for success of the offer.
6. The names of the merchant banker and other intermediaries together with the helpline number for the shareholders.
7. The specified date fixed as per sub-regulation (3) of regulation 10.
8. The object of the proposed delisting.
9. The proposed time table from opening of the offer till the payment of consideration or return of equity shares.
10. Details of the escrow account and the amount deposited therein.
11. Listing details and stock market data:
(a) high, low and average market prices of the equity shares of the company during the preceding three years;
(b) monthly high and low prices for the six months preceding the date of the public announcement; and,
(c) the volume of equity shares traded in each month during the six months preceding the date of public announcement.
12. Present capital structure and shareholding pattern.
13. The likely post-delisting shareholding pattern.
14. The aggregate shareholding of the promoter together with persons acting in concert and of the directors of the promoter where the promoter is a company and of persons who are in control of the company.
15. A statement, certified to be true by the board of directors of the company, disclosing material deviation, if any, in utilisation of proceeds of issues of securities made during the five years immediately preceding the date of public announcement, from the stated object of the issue.
16. A statement by the board of directors of the company confirming that all material information which is required to be disclosed under the provisions of continuous listing requirement have been disclosed to the stock exchanges.
92[16A: A statement by the board of directors of the company certifying that:-
(a) the company is in compliance with the applicable provisions of securities laws;
92 Inserted by the SEBI (Delisting of Equity shares) (Amendment) Regulations 2015, w.e.f. 24-03-2015.
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(b) the acquirer or promoter or promoter group or their related entities have not carried out any transaction during the aforesaid period to facilitate the success of the delisting offer which is not in compliance with the provisions of sub-regulation (5) of regulation 4;
(c) the delisting is in the interest of the shareholders.]
17. Name of compliance officer of the company.
18. It should be signed and dated by the promoter. Where the promoter is a company, the public announcement shall be dated and signed on behalf of the board of directors of the company by its manager or secretary, if any, and by not less than two directors of the company, one of whom shall be a managing director where there is one.
SCHEDULE II [See regulation 15(1)] THE BOOK BUILDING PROCESS
1. The book building process shall be made through an electronically linked transparent facility and the promoter shall enter into an agreement with a stock exchange for the purpose.
2. The public announcement and letter of offer shall be filed without delay with the stock exchange mentioned in paragraph 1 and such stock exchange shall forthwith post the same in its website.
3. The minimum number of bidding centres shall be:
(a) the four metropolitan centres situated at Mumbai, Delhi, Kolkata and Chennai;
(b) such cities in the region in which the registered office of the company is situated, as are specified by the stock exchange mentioned in paragraph 1.
4. There shall be at least one electronically linked computer terminal at all bidding centres.
5. The shareholders may withdraw or revise their bids upwards not later than one day before the closure of the bidding period. Downward revision of bids shall not be permitted.
6. The promoter shall appoint ‘trading members’ at the bidding centres, whom the public shareholders may approach for placing bids on the on-line electronic system.
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7. The shareholders holding dematerialised shares desirous of availing the exit opportunity may deposit the equity shares in respect of which bids are made, with the special depositories account opened by the merchant banker for the purpose prior to placement of orders or, alternately, may mark a pledge for the same to the merchant banker in favour of the said account.
8. The merchant banker shall ensure that the equity shares in the said special depositories account are not transferred to the account of the promoter unless the bids in respect thereof are accepted and payments made.
9. The holders of physical equity shares may send their bidding form together with the share certificate and transfer deed to the trading member appointed for the purpose, who shall immediately after entering their bids on the system send them to the company or the share transfer agent for confirming their genuineness. The company or the share transfer agent shall deliver the certificates which are found to be genuine to the merchant banker, who shall not make it over to promoter unless the bids in respect thereof are accepted and payment made. The bids in respect of the certificates which are found to be not genuine shall be deleted from the system.
10. The verification of physical certificates shall be completed in time for making the public announcement under regulation 18.
11. The bids placed in the system shall have an audit trail which includes stock broker identification details, time stamp and unique order number.
93[11A. Para 1 to 11 shall not be applicable in respect of the book building process where settlement is carried out through stock exchange mechanism as specified in sub-regulation (1A) of regulation 13 of these regulations.]
94[12. The final offer price shall be determined as the price at which shares accepted through eligible bids, that takes the shareholding of the promoter or the acquirer (along with the persons acting in concert) to ninety per cent. of the total issued shares of that class excluding the shares which are held by a custodian and against which depository receipts have been issued. If the final price is accepted, then, the 93 Inserted by the SEBI (Delisting of Equity shares) (Amendment) Regulations 2015, w.e.f. 24-03-2015.
94 ibid.
30 promoter shall accept all shares tendered where the corresponding bids placed are at the final price or at a price which is lesser than the final price. The promoter may, if he deems fit, fix a higher final price.
An illustration for arriving at the final offer price is given in the table below:
Bid price (Rs.)
Number of investors Demand (Number of shares) Cumulative demand (Number of shares) 550 5 2,50,000 2,50,000 565 8 4,00,000 6,50,000 575 10 2,00,000 8,50,000 585 4 4,00,000 12,50,000 595 6 1,20,000 13,70,000 600 5 1,30,000 15,00,000 Final Offer Price 605 3 2,10,000 17,10,000 610 3 1,40,000 18,50,000 615 3 1,50,000 20,00,000 620 1 5,00,000 25,00,000 48 25,00,000 Assuming floor price of Rs.550/- per share, promoter/ acquirer shareholding at 75% and number of shares required for successful delisting as 15,00,000, the final price would be the price at which the promoter reaches the threshold of 90%, i.e., it would be Rs.600/- per share.]
SCHEDULE III [See regulation 22(4)] CRITERIA FOR COMPULSORY DELISTING
1. The recognised stock exchange shall take all reasonable steps to trace the promoters of a company whose equity shares are proposed to be delisted, with a view to ensuring compliance with sub-regulation
(3) of regulation 23.
2. The recognised stock exchange shall consider the nature and extent of the alleged non-compliance of the company and the number and 31 percentage of shareholders who may be affected by such noncompliance.
3. The recognised stock exchange shall take reasonable efforts to verify the status of compliance of the company with the office of the concerned Registrar of Companies.
4. The names of the companies whose equity shares are proposed to be delisted and their promoters shall be displayed in a separate section on the website of the recognised stock exchange for a brief period of time. If delisted, the names shall be shifted to another separate section on the website.
5. The recognised stock exchange shall in appropriate cases file prosecutions under relevant provisions of the Securities Contracts (Regulation) Act, 1956 or any other law for the time being in force against identifiable promoters and directors of the company for the alleged non-compliances.
6. The recognised stock exchange shall in appropriate cases file a petition for winding up the company under section 433 of the Companies Act, 1956 (1 of 1956) or make a request to the Registrar of Companies to strike off the name of the company from the register under section 560 of the said Act.
K. M. ABRAHAM WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA