Sebi allows promoters to make indicative delisting price offer

Sebi allows promoters to make indicative delisting price offer

MUMBAI: The Securities and Exchange Board of India today approved a proposal that will allow promoters who are looking to de-list their company to make an indicative price offer over and above the floor price set by them.

The measure has been taken to ease the process of delisting price discovery in wake of the problems encountered by promoter of

, whose delisting offer failed.

The Economic Times on Wednesday had reported that the regulator may look at enabling a provision for promoters to make an indicative price offer in order to help existing investors to gauge the inclination of promoters.

In order to ensure price commitment, Sebi said that the promoter will be bound to accept the price discovered through the reverse book building process if it is equal to the floor price or indicative price.

Further, Sebi will now require independent directors of the board to make reasoned recommendations on the delisting proposal of the promoter. Timelines for completion of various activities forming part of the delisting process have been revised to make the process more efficient, Sebi said.

Promoters will be required to disclose their intention to delist the company by making an initial public announcement and the role of merchant banker involved in the delisting process has been elaborated, the regulator said.

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