Open offers by listed companies decline 39{bce2ac57dae147ae13b811f47f24d80c66c6ab504b39dda4a9b6e8ac93725942} to Rs 9,000 cr in Apr-Oct

Listed companies made worth close to Rs 9,000 crore to public shareholders in the first seven months of the current fiscal, a drop of 39 per cent from the year-ago period.

According to Sebi’s latest monthly report, a total of 30 for shares worth Rs 8,973 crore were made by the companies during the April-October this financial year (2020-21).

In comparison, 40 offers, amounting to Rs 14,603 crore, were made in the same period preceding fiscal.

Under the Sebi regulations, pursuant to the substantial acquisition of shares or change in control in a listed firm, an acquirer has to make an offer to the public shareholders, known as open offers, to give them a fair opportunity to exit the company.

The are made with the objective of change in control of management, consolidation of holdings and substantial acquisition in a company.

According to the data, during the first seven months of the current fiscal, the highest number of offers (26) worth Rs 8,959 crore was made towards change in control of management.

This was followed by two offers each for consolidation of holdings and substantial acquisition of shares.

In October, six open offers with offer value of Rs 481 crore were made to shareholders, compared to six offers with offer value of Rs 3,010 crore in September.

August saw the maximum number of open offers in value terms at Rs 3,862 crore (nine issues); two offers of 528 crore were received by shareholders in July; and June witnessed four offers worth 1,088 crore.

However, not a single open offer was made in May, while in April, three offers worth Rs 4 crore were made to shareholders.

Securities and Exchange Board of India (Sebi) rules require a mandatory open offer for minority shareholders in the event of any major change in the promoter holding of a listed company, including in the wake of any direct or indirect acquisition of 25 per cent.

Such open offers are required for the acquisition of up to 26 per cent stake from public shareholders.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor