Racing to meet Securities and Exchange Board of India’s (SEBI’s) deadline to achieve minimum 25 per cent public shareholding by June 3, four companies, on Friday, hit the market with their respective offer for sale (OFS) issues, and at least five others, including Tata Communications, lined up their share sales for Monday.
All listed private sector companies need to achieve 25 per cent minimum public shareholding by June 3 to avoid penal actions by the regulator.
The four companies that have hit the markets on Friday are: ELCID Investments, Fomento Resorts and Hotels, Modern India and Sharada Motor Industries.
On Thursday, nine companies, including Jet Airways and Tata Teleservices (M), hit the markets with their respective offer for sale (OFS) issues, worth nearly Rs.900 crore, to achieve 25 per cent minimum public share- holding.
Nearly 30 companies are yet to lower their promoter holdings to 75 per cent or below to comply with the guidelines, and, together, these firms would need to sell shares worth over Rs.5,000 crore. While nine of them have already announced share sales for today [Friday] or Monday, the others would need to make announcements in this regard over the week-end.
SEBI has allowed them to make an announcement for such sale of shares through the OFS route just one day in advance, as against earlier requirement of giving a notice at least one trading day in advance. This will help the companies make the announcements over the week-end as well.
In May so far, 63 companies have hit the market with their respective OFS issues. Many companies are expected to follow suit as SEBI’s deadline is fast approaching.
For public sector companies, minimum public shareholding has been fixed at 10 per cent, and the deadline is till August 8. These norms were announced in June, 2010, to ensure that public investors get a larger presence and help create an equity culture.
To help companies comply with the new public shareholding norms, SEBI, in 2012, created two new routes — offer for sale (OFS) and institutional placement programme (IPP). The regulator also allowed companies to use rights and bonus issue routes to enhance public holding.
Jet complies with SEBI norm
Jet Airways, on Friday, said it had complied with SEBI’s 25 per cent minimum public shareholding norm by selling 5 per cent of its promoters’ stake through the OFS route and block deal.
“The company’s promoter Tail Winds Ltd. has, through an OFS /block deal, sold 43.17 lakh (amounting to 5 per cent stake) equity shares through the stock exchanges,” Jet Airways said in a regulatory filing.
Pursuant to the share sale, the company has now complied with the minimum public share holding norm of 25 per cent as stipulated by SEBI.
Earlier in the day, Jet Airways said that SEBI had allowed its promoters to sell further 1.54 per cent stake. Jet Airways on Thursday received bids for around 30 lakh scrips, accounting for 3.5 per cent stake, against the offer of nearly 43 lakh shares.
Meanwhile, Tail Winds is in the process of transferring its stake to Jet Airways Chairman Naresh Goyal.
Maran reduces holding in Sun TV to 75 %
Sun TV Network on Friday said its promoter Kalanithi Maran has sold 2 per cent stake in the company, bringing down his holding in the firm to 75 per cent. Maran has sold 78,81,700 equity shares of Sun TV, which is 2 per cent of its total equity share, the company said in a filing to the BSE.
