SAT dismisses shareholder's plea on Bharti-MTN open offer

MUMBAI: The Securities Appellate Tribunal today "dismissed" an appeal by a Bharti Airtel shareholder that challenged an informal guidance by SEBI exempting South Africa's MTN from making an open offer to Bharti shareholders if a merger between the two materialises.

A bench comprising Justices N K Sodhi and Samar Ray observed that the appeal was "premature" and dismissed it as "infructious".

Bharti Airtel shareholder Deepak Mehra, who holds around 100 shares aggregating to around Rs 40,000, sought to overturn an informal guidance issued by SEBI on June 22.

The market regulator had said that MTN need not make an open offer to Bharti Airtel shareholders in India as its holding in the Sunil Mittal-promoted firm would be through Global Depository Reciepts (GDRs).

SEBI said the open offer will only trigger once the GDRs, issued to MTN and its shareholders by Bharti Airtel are converted into local shares with voting rights.

Sodhi observed that a department of SEBI had only issued an informal guidance to Bharti Airtel on June 22, which was not binding on its Board.

As per regulations, SAT can only overturn orders passed by SEBI.