A bench headed by Justice SS Nijjar, while issuing notice to Akshya Infrastructure, stayed the Securities Appellate Tribunals order that set aside Sebis letter wherein the request of Akshya to withdraw the open offer was declined. Sebi had also, in its November last years communication, warned the acquirer and Margs promoters of penal action if it did not go ahead with the offer.
In October 2011, Akshya had made an open offer to the Marg shareholders so as to give them an opportunity to exit at the offer price of R91 per equity share at a premium of 10.30% over the market average closing price, calculated on the basis of the trend of price fluctuations in the preceding two weeks from the date of the public announcement. The open offer was made to acquire 20% stake (76.5 lakh shares) in Marg to consolidate the company's holdings.
Akshya had filed the draft letter of offer with Sebi, along with relevant documents, in October 2011. But after the documents were filed, the regulator detected violations of the takeover code that prevents acquisition of shares in excess of 5% a year. This has triggered the mandatory open offer.
However, due to the long lapse of time in securing Sebis approval for the open offer, the company had sought regulators approval to withdraw the offer but that was not granted. Following this, Akshya approached SAT to allow it to withdraw the offer without any adverse orders or directions and ask the regulator to refund R17.46 crore deposited in escrow in lieu of the offer.
The tribunal had justified Akshyas desire to withdraw the public offer saying that time is of the essence in such matters and Sebis silence for months together in this case would tantamount to refusal of the appellants (Akshya Infrastructure) offer It added: We fail to understand the reason behind the respondents indifference in responding to the appellants draft letter of offer.