Minority shareholders of ICICI Securities (I-Sec) have sought the exemption letter from ICICI Bank granted to it by the Securities and Exchange Board of India (Sebi).
“The exemption letter will give us an insight into the arguments presented by the bank in front of the regulator as to why this company should be delisted at this valuation, and by taking an exemption from a very logical reverse book building process,” a minority shareholder of I-Sec told FE.
Over 100 minority shareholders of ICICI Securities have filed a class action suit with the Delhi bench of the National Company Law Tribunal (NCLT) against the delisting plans of ICICI Securities. Manu Rishi Guptha, founder of Bengaluru-based investment fund MRG Capital, is representing minority shareholders. “Sebi operates on the principle of ‘innocent unless proven guilty’. The regulator’s exemption has been used to cheat the minority shareholders,” Guptha said.
The minority shareholders have opposed the share swap ratio proposed for delisting the brokerage. Under the proposed delisting plan, I- Sec shareholders will receive 67 shares of ICICI Bank for every 100 shares they currently hold.
Minority shareholders say the exemption letter will help them decide their future course of action against ICICI Bank.
ICICI Securities, on March 28, received shareholders’ approval to delist its stock, paving the way to merge with parent and majority shareholder ICICI Bank despite resistance from some retail shareholders. A total 71.9% of the shareholder votes were cast in favour of the proposal to merge ICICI Securities with ICICI Bank after delisting.
On April 10, Quantum Mutual Fund, a minority shareholder, had objected to the scheme of merger, saying it is “flawed and bridled with irregularities” and will adversely affect minority shareholders.