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
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).
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