SEBI notifies Issue of Capital and Disclosure Requirements (Second Amendment) Regulations, 2021

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SEBI - Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations 2021 - taxscan

The Securities and Exchange Board of India (SEBI) notified the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2021 which seeks to amend the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018.

In Regulation 282, in sub-regulation (3), the words “Institutional Trading Platform” shall be substituted with the words “Innovators Growth Platform”.

In Regulation 282 after sub-regulation (3), the new sub-regulation shall be inserted, namely “if an issuer has issued SR equity shares to its promoters/ founders, the said issuer shall be allowed to make an initial public offer of only ordinary shares for listing on the Innovators Growth Platform subject to compliance with the provisions of this Chapter and continued compliance with the provisions for SR equity shares in accordance with sub-regulation (3) of regulation 6.”

The notification seeks to insert a new Regulation 290A in respect of exit of issuers whose securities are listed and trading on the Innovators Growth Platform pursuant to an initial public offer.

Under Regulation 290A, the provisions of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, in respect of the matters not specifically dealt or excluded under this regulation, shall apply mutatis mutandis to delisting of specified securities under these regulations.

An issuer company whose specified securities are traded on the Innovators Growth Platform pursuant to an initial public offer may exit from the Innovators Growth Platform, if  such an exit is approved by the board of directors of the company in its meeting; such an exit is approved by the shareholders of the company by a special resolution passed through postal ballot or e-voting, after disclosure of all material facts in the explanatory statement sent to the shareholders in relation to such resolution.

Provided further that the special resolution shall be acted upon only if the votes cast by the majority of public shareholders are in favor of such exit proposal.

Delisting price is based on a floor price determined in terms of regulation 8 of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as may be applicable, and an additional delisting premium justified by the acquirer / promoter;

The post offer acquirer / promoter shareholding (along with the persons acting in concert with the acquirer / promoter), taken together with the shares tendered reaches seventy five per cent of the total issued shares of that class and at least fifty per cent shares of the public shareholders as on date of the meeting referred to in clause (a) of this sub-regulation are tendered and accepted; and

Recognised stock exchange(s) where its shares are listed approves of such an exit.” in regulations 292, the existing sub-regulation (3) shall be substituted with the following, namely, “A company not satisfying the conditions laid down under sub-regulation (2) of regulation 292, shall, as on date of application for migration under the regular category, have fifty per cent of its capital held by Qualified Institutional Buyers.”

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