It has been observed that Open offers have become a favourite ground for market manipulators & insiders. Please note the following specific cases:
1. Open offer of Tata teleservices Maharastra Ltd. (TTML) ---Just prior to the announcement of Open offer the price & volume had gone up substantially giving clear signs of insider trading . Price & volume increased in the last week prior to the offer( page No. 45 OF OFFER DOCUMENT-price increased by 18.46% and volume by 361.87%.). Again on 12th March the price was manipulated to as low as Rs.15.70. Who will sell the shares at 15-16 when he could still tender in the Open offer at 24.70? Probably the price was rigged to encourage more people to tender their shares in the Open offer which was hugely undersubscribed.
2. Open Offer -- OCL Iron And Steel Ltd.---The PA carries the mandatory 26 Weeks & 2 weeks price, Rs. 7.47 & Rs.20.31respectively. The 270% jump in the price of the share just before the announcement of PA raises a question— whether the insiders are taking undue advantage of their privileged information?
3. Open Offer of Great Offshore Ltd.--- Again here the PA discloses 26 weeks average as Rs.257.04 and 2 weeks average as Rs.343.16 i.e. a jump of 33% just before the announcement.
About Me
- CA. Arun Goenka
- The Original CHAUKIDAAR ,“TAKEOVER WATCHMAN” since 2007. CA. Arun Goenka* hands-on experience in the share market* deep knowledge of laws and account*one of the early players, pioneered an investment strategy in TAKEOVERS*The WIRC - of The Institute of Chartered Accountants of India, has honoured him with the ‘Recognition of CAs in Social Service’. * often invited by National business news; electronic and print media, for his views on SEBI related matters. * history of red-flagging 100+ cases to SEBI* contributes by giving inputs in drafting amendments to the regulation* Some of the suggestions reflected in subsequent regulatory changes: (a). In takeover of Cairn 3,750 Crores non-compete fees waived off and ultimately Removal of Non-compete fee in 2011 (b) November 2009 amending Regulation 11 (1). (c)Listing agreement baring promoters from voting on related party. (d) Disclosure of past performance by merchant bankers in case of IPO (e) SAST 2011 regulation 10(1)(h), (f) Counter Offer in case of Delisting (g) Interest payment to all in case of delays in Open Offers(05.06.20).
Saturday, June 13, 2009
GWALIOR CHEMICAL TAKEOVER
Lptp/mydoc/takeover/sebi
June 9, 2009
To,
Shri C.B. Bhave,
The Chairman
SEBI
SEBI Bhavan, 3rd Floor, B Wing,
Plot No. C-4A, G Blockce
Bandra Kurla Complex
Mumbai: 400051
Dear Sir,
Takeover of Gwalior Chemicals Ltd.
The Indian Corporates are always fast in adopting any smart move successfully executed by others in bypassing the law. Earlier in the case of Eicher motors Ltd. it happened and now the same model has been adopted by Gwalior Chemicals Ltd. Just examine the following:
1. A company with a market cap of Rs.266 Crs.—Gwalior Chemicals, Is being taken over at double the amount –Rs.536 Crs. and it does not amount to TAKEOVER?
2. If 15% of the shares were bought of the same co.—amounting to Rs. 40 Crs. –it will be take over.
3. Why would Mylan etc takeover cos like Matrix and come out with an Open Offer & later delisting offer? When a escape route is available in the present format it will be foolish not to exploit it.
4. By buying just the assets the Acquirers takes care of 2 steps at one go—avoids making an Open offer and also subsequent delisting exercise
5. If this loophole is not plugged soon we will have many dud or KHOKA companies listed on our exchanges.
6. Regulation 12 says Acquisition of control over a company—how then acquisition of control over substantial parts or whole of the company’s assets is not “ Acquisition of control” ?
You are requested to kindly examine the above and issue necessary directives to the acquirer to come out with an Open offer as per the SAST at the earliest.
Yours faithfully,
Arun Goenka
June 9, 2009
To,
Shri C.B. Bhave,
The Chairman
SEBI
SEBI Bhavan, 3rd Floor, B Wing,
Plot No. C-4A, G Blockce
Bandra Kurla Complex
Mumbai: 400051
Dear Sir,
Takeover of Gwalior Chemicals Ltd.
The Indian Corporates are always fast in adopting any smart move successfully executed by others in bypassing the law. Earlier in the case of Eicher motors Ltd. it happened and now the same model has been adopted by Gwalior Chemicals Ltd. Just examine the following:
1. A company with a market cap of Rs.266 Crs.—Gwalior Chemicals, Is being taken over at double the amount –Rs.536 Crs. and it does not amount to TAKEOVER?
2. If 15% of the shares were bought of the same co.—amounting to Rs. 40 Crs. –it will be take over.
3. Why would Mylan etc takeover cos like Matrix and come out with an Open Offer & later delisting offer? When a escape route is available in the present format it will be foolish not to exploit it.
4. By buying just the assets the Acquirers takes care of 2 steps at one go—avoids making an Open offer and also subsequent delisting exercise
5. If this loophole is not plugged soon we will have many dud or KHOKA companies listed on our exchanges.
6. Regulation 12 says Acquisition of control over a company—how then acquisition of control over substantial parts or whole of the company’s assets is not “ Acquisition of control” ?
You are requested to kindly examine the above and issue necessary directives to the acquirer to come out with an Open offer as per the SAST at the earliest.
Yours faithfully,
Arun Goenka
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