SEBI relaxes de-listing guidelines; scraps mandatory participation clause

Making a raft of changes to regulations, the market regulator SEBI also has relaxed de-listing guidelines and scrapped mandatory participation of 25% demat shareholders. However, tweaking of norms come with certain riders. As per the conditions laid down by SEBI, the acquirer or the investment banker will have to prove that all shareholders were contacted in the manner prescribed. Apart from easing de-listing norms, Sebi’s board has also approved rules on issue of partly paid shares. In case of partly paid shares issued through Rights Issue, a minimum 25% of the issue price will have to be paid up-front. The balance consideration is required to be paid within 12 months, if the issue size is less than Rs 500 crore and in case the issue size is above Rs 500 crore, issuer can decide on the period of payment. Besides, that market watchdog also has approved amendments to Issue and Listing of Debt Securities guidelines, and has enabled re-issuance of corporate debt securities, which would enable illiquid corporate bonds to be reissued and increase liquidity in the market. It has permitted enabling ‘Call & Put Options’ that will help issuer or investor to have flexibility in redemption of debt securities. Lastly, it has allotted 18 months to listed companies of regional stock exchanges to switch to nation-wide stock exchanges.