Sebi amendment to help sale of Satyam Computer
Amended rules disallow open offers from bidders if an acquirer has already made an offer. Gainers: BSE ( A, B ) | NSE | Losers: BSE ( A, B ) | NSE | 52 Week: High, Low
By Agencies |
MUMBAI: Satyam Computers Chairman, Kiran Karnik, on Friday welcomed the Sebi amendment to the takeover regulations.
"I have not seen the Sebi amendment in great detail but welcome this move as it helps us (Satyam Board) to move quickly (on the sale process)," Karnik told reporters on the sidelines of the Nasscom summit here.
"We were waiting for Sebi to come out with its norms as it defines our further process," Karnik said.
Sebi eased takeover norms for companies whose board has been superseded by the government, under which suitors such as those for Satyam Computer need not make an open offer.
The amended rules also disallows open offers from rival bidders if an acquirer has already made an open offer.
The regulator said the amendment to the Sebi (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, provides for "relaxation from the strict compliance of provisions of Chapter-III in certain cases."
Chapter-III deals with mandatory open offer if an entity acquires 15 per cent stake in a company, as also for acquisition or change of control of the company, among others.
Sebi, on an application made by a target company, said it can relax any or more provisions of this chapter if certain conditions are met. It was referring to cases where central, state government or any other regulator having superseded the board of a company.
Further, the directors so appointed need to formulate a plan which provides for transparent, open, and competitive process for continued operation of the target company in the interests of all stakeholders and such plan does not further the interests of any particular acquirer, the markets regulator said.
The conditions and requirements of the competitive process are reasonable and fair, and the process provides for details including the time when the public offer would be made, completed and the manner in which the change in control would be effected.
The regulator had earlier this month said it would relax the takeover norms to deal with cases like Satyam Computer, whose government-appointed board had sought relaxation in the acquisition rules.
The government had superseded the IT company's board after the company founder Ramalinga Raju disclosed on January 7 that he had fudged accounts for years.
"I have not seen the Sebi amendment in great detail but welcome this move as it helps us (Satyam Board) to move quickly (on the sale process)," Karnik told reporters on the sidelines of the Nasscom summit here.
"We were waiting for Sebi to come out with its norms as it defines our further process," Karnik said.
Sebi eased takeover norms for companies whose board has been superseded by the government, under which suitors such as those for Satyam Computer need not make an open offer.
The amended rules also disallows open offers from rival bidders if an acquirer has already made an open offer.
The regulator said the amendment to the Sebi (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, provides for "relaxation from the strict compliance of provisions of Chapter-III in certain cases."
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Chapter-III deals with mandatory open offer if an entity acquires 15 per cent stake in a company, as also for acquisition or change of control of the company, among others.
Sebi, on an application made by a target company, said it can relax any or more provisions of this chapter if certain conditions are met. It was referring to cases where central, state government or any other regulator having superseded the board of a company.
Further, the directors so appointed need to formulate a plan which provides for transparent, open, and competitive process for continued operation of the target company in the interests of all stakeholders and such plan does not further the interests of any particular acquirer, the markets regulator said.
ADVERTISEMENT
The conditions and requirements of the competitive process are reasonable and fair, and the process provides for details including the time when the public offer would be made, completed and the manner in which the change in control would be effected.
The regulator had earlier this month said it would relax the takeover norms to deal with cases like Satyam Computer, whose government-appointed board had sought relaxation in the acquisition rules.
ADVERTISEMENT
The government had superseded the IT company's board after the company founder Ramalinga Raju disclosed on January 7 that he had fudged accounts for years.
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