Capital markets regulator Sebi Wednesday decided to expand its offer for sale (OFS) framework to all the companies with market capitalisation of Rs 1,000 crore and above.
Capital markets regulator Sebi Wednesday decided to expand its offer for sale (OFS) framework to all the companies with market capitalisation of Rs 1,000 crore and above. Currently, the OFS framework is available to top 200 companies by market capitalisation. Also, if the seller fails to get sufficient demand from non-retail investors at or above the floor price on the first day of offer, then the seller may choose to cancel the offer post bidding in full (both retail and non-retail) on the first day itself and not proceed with the offer to retail investors on the second day.
“OFS mechanism shall be available for shareholders of companies with market capitalization of Rs 1,000 crore and above,” the regulator said in a statement issued here after its board meeting. Further, the board has cleared a proposal for change in norms requiring the filing of a fresh offer document in case of an OFS where there is a change in the number of shares offered for sale, or in the estimated issue size, by more than 50 per cent.
At present, in case of any increase or decrease in the estimated issue size by over 20 per cent, fresh filing of the offer document with Sebi is required. Such requirement is for both fresh issues and OFS.
Besides, Sebi board has cleared a proposal to allow custodial services in the commodity derivatives market to enable institutional participation. Also, housing finance companies and systemically important NBFCs (non-banking financial companies) have been exempted from disclosure of increase or decrease in shareholding due to encumbrance or release of the encumbrance of shares, Sebi said. A similar exemption is already available to scheduled commercial banks and public financial institutions.