Court bars Intime from taking up any fresh business
Intime Spectrum, the country’s second-largest share registrar and transfer agent, has been barred by a Kolkata court from undertaking any fresh business in the capital market.
By Gaurav Pai, ET Bureau |
MUMBAI: Intime Spectrum, the country���s second-largest share registrar and transfer agent, has been barred by a Kolkata court from undertaking any fresh business in the capital market.
The court order has also held in abeyance the deal where Australia-based Link Market Services was to acquire about 51% equity stake in the leading share registrar. The order was passed in a previous matter pertaining to Intime buying a majority stake in MCS, another registrar. Intime has the option of appealing against the decision in the Calcutta High Court.
Since the matter is sub judice, executives at both the companies, Intime and MCS, refused to comment on the court order. Intime���s decision to offer stake to a strategic investor came at a time when RTAs across the country were battling with shrinking profit margins, depressed market conditions, and the need for huge capital investments. But the court���s order if not reversed, will affect the successful completion of the deal.
A weak equity market has also seen companies postpone their plans of initial public offers, with many analysts saying that IPOs would probably start in the second half. If Intime is unable to get back to work by then, then the already small share registrar industry would shrink still further. Intime is currently working on IPOs of Sejal Infrastructure and First Winner, both of which will have to be handed over to another share registrar, unless Intime manages to procure a stay from a higher judicial court. It is also in process of being awarded a few more IPO mandates, a person familiar with the affairs of the company said.
The court order comes in the wake of a suit filed by MCS, where MCS has alleged non-compliance of agreement by Intime. Acquisition of Mumbai-based share registry company MCS by Intime Spectrum Registry had run into rough weather last year due to a delay in the shifting of clients from MCS to Intime.
This is actually the second round of war of words between the two registrars, that had agreed to settle their year-long legal dispute last year through an out-of-court arbitration. Last time, the case had even gone to the Supreme Court, which directed the two warring registrars to sort out their differences in the Alipore trials court.
The court order has also held in abeyance the deal where Australia-based Link Market Services was to acquire about 51% equity stake in the leading share registrar. The order was passed in a previous matter pertaining to Intime buying a majority stake in MCS, another registrar. Intime has the option of appealing against the decision in the Calcutta High Court.
Since the matter is sub judice, executives at both the companies, Intime and MCS, refused to comment on the court order. Intime���s decision to offer stake to a strategic investor came at a time when RTAs across the country were battling with shrinking profit margins, depressed market conditions, and the need for huge capital investments. But the court���s order if not reversed, will affect the successful completion of the deal.
A weak equity market has also seen companies postpone their plans of initial public offers, with many analysts saying that IPOs would probably start in the second half. If Intime is unable to get back to work by then, then the already small share registrar industry would shrink still further. Intime is currently working on IPOs of Sejal Infrastructure and First Winner, both of which will have to be handed over to another share registrar, unless Intime manages to procure a stay from a higher judicial court. It is also in process of being awarded a few more IPO mandates, a person familiar with the affairs of the company said.
The court order comes in the wake of a suit filed by MCS, where MCS has alleged non-compliance of agreement by Intime. Acquisition of Mumbai-based share registry company MCS by Intime Spectrum Registry had run into rough weather last year due to a delay in the shifting of clients from MCS to Intime.
This is actually the second round of war of words between the two registrars, that had agreed to settle their year-long legal dispute last year through an out-of-court arbitration. Last time, the case had even gone to the Supreme Court, which directed the two warring registrars to sort out their differences in the Alipore trials court.
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