Capital market regulator SEBI has found no violations of takeover norms by the promoters of telecom major Bharti Airtel during certain transactions that took place in 2007-2008, Parliament was informed on Tuesday.
SEBI had probed the matter following complaints that certain promoter entities of Bharti Airtel had violated some provisions of takeover norms, Minister of State for Finance Namo Narain Meena informed the Rajya Sabha in a written reply.
As part of its probe, SEBI had sought comments from the entities concerned and examined the responses received.
“After examination and taking in to consideration relevant case laws, it was observed that the allegation do not stand established...” the minister said, while adding that the matter was closed in November 2012.
The complaints related to alleged violation of SEBI norms for takeover and substantial acquisition of shares, when the promoter group shareholding of Bharti Airtel rose from 60.91 per cent to 67.03 per cent during the period from June, 2007 to September, 2008.
It was alleged that Pastel Ltd acted as a person acting in concert (PAC) with two promoter entities — Bharti Telecom and Indian Continental Investment Ltd (ICIL) — for purpose of acquiring 6.27 per cent shareholding in Bharti Airtel, which attracted an obligation to make an open offer under the takeover norms.
However, Meena said that the allegations were not established, as two persons can be termed as PAC only if the common purpose of substantial acquisition of shares pursuant to an agreement, co-operate by agreeing to acquire shares rights in the target company.
“Pastel does not appear to share common objective or purpose with Bharti Telecom or ICIL with regard to acquisition of shares/voting rights/control of Bharti Airtel, therefore, its holding cannot be taken together with shareholdings of Bharti Telecom and ICIL for the purpose of acquisition of shares of Bharti Airtel made by ICIL,” he said.
Further, he said the promoter and promoter group does not figure in the list of entities which are considered as “deemed PAC” as per the takeover norms.
In response to a specific query about the action taken by the Company Law Board (CLB) in this matter, the minister said that violations of takeover norms does not fall within the jurisdiction of CLB.