The market regulator securities and exchange board of India (Sebi) has notified the Sebi (Delisting of Equity Shares) regulations, 2009, which would govern the normal guidelines to be followed by a company for delisting its shares from a stock exchange.
According to the notified guidelines, the offer price for delisting shall be determined by calculating the average of the weekly high and low of the closing prices during the last twenty six weeks or two weeks preceding the date on which the recognized stock exchange were notified. Currently, the offer price was decided on the basis of the average of the last 26 weeks.
A senior executive of a leading investment banking company said, ?Given the current market situation where the share prices have again bounced back sharply, if the offer price is determined on the basis of the previous rule where the average of last 26 weeks are calculated, it would prove disadvantageous to the shareholders. So the incorporation of two weeks average price is a welcome step?.
Further the open offer would be considered a success only when the shareholding of the promoter combined with the shares accepted through eligible bids crosses 90% of the total shares issued or when it reaches higher than the total of 50% of the offer size and the aggregate percentage of pre offer promoter shareholding.
On closure of the open offer process, all share holders whose equity shares are verified to be genuine shall be paid the final price stated in the public announcement within ten working days.
With regards to the remaining public shareholder holding such equity shares may tender his shares to the promoter upto a period of atleast one year from the date of delisting.
On tendering of shares by the remaining shareholder, the promoter shall pay the same price at which the earlier acceptance of shares was made.