The Securities and Exchange Board of India (SEBI) on Thursday permitted promoters of top 100 companies to quickly dilute their shares through a separate window on the BSE and the National Stock Exchange, which had to be completed within a day.
The guidelines, SEBI said in a circular, will help promoters dilute or offload their holding in listed companies in a transparent manner with wider participation.
The norms, which follow the decision taken by the SEBI board earlier this month, will help the companies in complying with the minimum public shareholding stipulation.
The decision will also help the government expeditiously offload its stake in public sector companies and raise funds for achieving the disinvestment target of Rs.40,000 crore for the current fiscal.
All listed companies are required to have at least 25 per cent public holding while in case of state-owned company the limit is 10 per cent.
Under this window, the promoter will have to sell equity of minimum one per cent subject to a minimum of Rs.25 crore.
“However, in respect of companies, where one per cent of the paid-up capital at closing price on the specified date is less than Rs.25 crore, dilution would be at least 10 per cent of the paid-up capital or such lesser percentage so as to achieve the minimum public shareholding in a single tranche,” it said.
The duration of the offer for sale shall not exceed one trading day, it said, adding that the placing of orders by trading members should take place during trading hours.
As per the guideline, the promoters should not have purchased shares of the company during the 12 weeks period prior and after the offer of sale.
“All promoters or promoter group entities of top 100 companies based on average market capitalisation of the last completed quarter,” it said.
The guideline said that minimum of 25 per cent of the shares offered shall be reserved for mutual funds and insurance companies.
