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Allow exit for Sterling and Wilson investors: InGovern

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The proxy advisory firm has said that the capital market regulator should force Sterling and Wilson Solar to give an exit option to its investors for allegedly using the public issue proceeds in a manner that was not stated in the prospectus.

Proxy advisory firm InGovern has said that the capital market regulator should force Sterling and Wilson Solar, which listed on the bourses in August 2019, to give an exit option to its investors for allegedly using the public issue proceeds in a manner that was not stated in the prospectus.

According to InGovern, while the objective of the issue was to enable the promoters — belonging to the Shapoorji Pallonji Group — repay loans amounting to ₹2,563 crore taken from the company, only ₹1,000 crore had been paid till December 31, 2019.

The initial public offer (IPO) was an offer for sale by the promoters who got ₹2,850 crore through the offering.

“This is tantamount to change of objects of the IPO from what was stated in the prospectus. This has resulted in aggrieved minority public shareholders. SEBI (ICDR) Regulations, 2018 allow for the dissenting shareholders to be provided an exit offer by the promoters, in cases where there is a change in objects of the issue/ offer in the IPO prospectus,” stated the InGovern report.

The company, however, has denied making any misleading statements in its prospectus and has said that the report was “malicious, misleading, defamatory and without any attempt to ascertain the facts of the matter” from the listed firm..

“The report contains factually incorrect, misleading and unverified statements. The author of the report has acted irresponsibly as he has neither found it appropriate to ascertain the facts nor provide us with a draft of the report for our response. This appears an attempt to malign the reputation of the promoters using the media,” said the company in a statement.

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Printable version | Jan 27, 2020 2:35:52 AM | https://www.thehindu.com/business/allow-exit-for-sterling-and-wilson-investors/article30526761.ece

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