Certain relaxations have also been extended to insolvent entities with respect to regulations pertaining to substantial acquisition of shares and takeovers as well as issue of capital and disclosure requirements, according to separate notifications.
The Securities and Exchange Board of India has exempted companies under the Insolvency and Bankruptcy Code from following the prescribed norms of delisting, with certain riders. “Nothing in these regulations shall apply to any delisting of equity shares of a listed entity made pursuant to a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, 2016,” a notification in the Gazette of India said.
In case the existing promoters or any other shareholders are to be provided an opportunity to exit under the resolution plan at a price higher than the price determined, then at least the same price should be offered for the existing public shareholders of that particular entity, as per the notification.
“…provided that, exit to the shareholders should be at a price which shall not be less than the liquidation value as determined under regulation 35 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, after paying off dues in the order of priority as defined under section 53 of the Insolvency and Bankruptcy Code, 2016”, it said.
“… the details of delisting of such shares along with the justification for exit price in respect of delisting proposed shall be disclosed to the recognised stock exchanges within one day of resolution plan,” it added.
Certain relaxations have also been extended to insolvent entities with respect to regulations pertaining to substantial acquisition of shares and takeovers as well as issue of capital and disclosure requirements, according to separate notifications.
The move is expected to provide succour for various listed companies that have been referred for resolution under the Insolvency and Bankruptcy Code (IBC). More than 750 entities, including many listed firms, are facing insolvency proceedings. —Fe with
via With riders: Sebi exempts IBC firms from delisting norms | The Indian Express
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