About SEBI The Securities and Exchange Board of India was established on PREAMBLE The Preamble of the Securities and Exchange Board of India describes the basic functions of the Securities and Exchange Board of India as “…..to protect the interests of investors in securities and to promote the development of, and to regulate the securities market and for matters connected therewith or incidental thereto” Code on Conflict of Interests for Members of Board Powers and Functions of the Board Composition of Securities Appellate Tribunal (SAT):
In a big-bang market reform, the Securities and Exchange Board of India (SEBI) on Thursday accepted the all-important Takeover Code (of listed companies) for implementation wherein the mandatory open offer size in a company has been raised to 26 per cent from the existing 20 per cent. | |||||||||||||||||||||||||||||||||||||||||||||||||
| At the same time, the trigger point for open offer will now stand higher at 25 per cent from earlier 15 per cent, according to SEBI. Briefing newspersons, the SEBI Chairman U K Sinha said the (SEBI) Board has by and large accepted the recommendations of the Takeover Regulations Advisory Committee (TRAC) for implementation. SEBI has also abolished the non-compete fees that acquirers generally pay to the sellers in M&A deals. While the recommendation of the TARC on trigger has been accepted, the same for offer size has been kept lower due to intense opposition from industry and other market participants. The TARC it its recommendation had said that all the public shareholders were required to be given an exit opportunity in case of promoters of target company selling out their stake to acquirers. Apart from the Takeover Code, SEBI has asked merchant banks or lead managers to disclose their track record to IPO investors. The market regulator has also announced slew of initiatives for retail investors to take an informed view on IPOs as well as Mutual funds. Simply put, SEBI initiated a process to make IPO forms shorter and simpler. "The IPO form will now carry track record of the merchant banker and pricing information. Besides the new format will reduce size of the application to one fourth of the existing ones," Sinha said. He also said that it (SEBI) will regulate distributions of mutual fund products. To help Mutual Funds penetrate into retail segment in smaller towns, the distributors would be allowed to charge Rs 100 as transaction charge per subscription. However, no charge can be made for investments below Rs 10,000. An additional amount of Rs 50 can be charged to first time Mutual Fund investor. However, there would be no transaction charge on transactions other than purchases/ subscriptions relating to new inflows and direct transactions with the Mutual Fund. Sinha clarified that for SIPs, the transaction charges can be recovered in 3 or 4 instalments, which are in addition to the existing commissions permissible to the distributors. Sinha also said there will be amendment on advertising code for MFs to disclose financial information in absolute terms, not CAGR wise. Even as Sinha maintained that the new Takeover Code is pragmatic, the industry believes that it may not be sustainable in the long run. They view that SEBI should have come up with a road map for open offer size to 100 per cent with conditions.
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Thursday 28 July 2011
Securities and Exchange Board of India Sebi changes takeover code trigger at 25% www.sebi.gov.in SEBI to implement report on NSDL role in IPO scam
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