TaxTMI 
TaxTMI 
Guidelines for “Qualified Institutions Placement” – Amendments to SEBI (Disclosure and Investor Protection) {DIP} Guidelines, 2000
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....ements of minimum public shareholding of the listing agreement will be eligible to raise funds in domestic market by placing securities with Qualified Institutional Buyers (QIBs). Securities: Securities which can be issued through QIP are equity shares or any securities other than warrants, which are convertible into or exchangeable with equity shares (hereinafter referred to as "specified securities"). A security which is convertible into or exchangeable with equity shares at a later date, may be converted or exchanged into equity shares at any time after allotment of security but not later than sixty months from the date of allotment. The specified securities shall be made fully paid up at the time of allotment. Investors / Allottees: The specified securities can be issued only to Qualified Institutional Buyers (QIBs), as defined under sub-clause (v) of clause 2.2.2B of the SEBI (DIP) Guidelines. Such QIBs shall not be promoters or related to promoters of the issuer, either directly or indirectly. Each placement of the specified securities issued through QIP shall be on private placement basis, in compliance with the requirements of first proviso to clause (a) of sub-sectio....
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.... with SEBI within thirty days of the allotment, for record purpose. 2. The above policy decisions have been given effect to by introducing Chapter XIIIA in the SEBI (DIP) Guidelines, 2000. A copy of Chapter XIIIA is enclosed herewith at Annexure I. 3. The amendments made vide this circular shall come into force with immediate effect. 4. This circular is being issued in exercise of the powers conferred under sub-section (1) of Section 11 of the Securities and Exchange Board of India Act, 1992. 5. This circular is available on SEBI website at www.sebi.gov.in under the category "Legal Framework". The entire text of the SEBI (DIP) Guidelines, 2000, including the amendments issued vide this circular, is available on SEBI website under the categories "Legal Framework" and "Issues and Listing". Yours faithfully, Neelam Bhardwaj Encl.: a/a ANNEXURE I CHAPTER XIII-A OF THE SEBI (DIP) GUIDELINES, 2000 GUIDELINES FOR QUALIFIED INSTITUTIONS PLACEMENT (QIP) 13A.1 Applicability 13A.1.1 This Chapter shall apply to any issue of equity shares / fully convertible debentures (FCDs) / partly convertible deben....
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.....3 Pricing 13A.3.1 An issue of specified securities made under this Chapter shall be made at a price not less than the higher of the following: i) The average of the weekly high and low of the closing prices of the related shares quoted on the stock exchange during the six months preceding the relevant date; OR ii) The average of the weekly high and low of the closing prices of the related shares quoted on the stock exchange during the two weeks preceding the relevant date. Explanation: a) "relevant date" for the purpose of this clause means the day which is thirty days prior to the date on which the meeting of general body of shareholders is held, in terms of sub-section (1A) of Section 81 of the Companies Act, 1956 or other applicable provision to consider the proposed issue. b) "stock exchange" for the purpose of this clause means any of the recognised stock exchanges in which the equity shares of the issuer of the same class are listed and in which the highest trading ....
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....section (1A) of Section 81 of the Companies Act, 1956 or any other applicable provision. 13A.6.2 The resolution passed at the meeting of shareholders referred to in clause 13A.6.1 above shall specify that the allotment is proposed to be made to QIBs pursuant to this Chapter and shall also specify the relevant date on the basis of which price of the resultant shares as specified under clause 13A.3.2.2 shall be determined. 13A.6.3 The placements made pursuant to authority of the same shareholders' resolution shall be separated by at least six months between each placement. 13A.7 Placement Document 13A.7.1 Specified securities shall be issued pursuant to this Chapter on the basis of a placement document. 13A.7.2 The placement document shall contain all material information, including the information specified in Schedule XXIA. 13A.7.3 The placement document shall be a private document provided to select investors, through serially numbered copies. 13A.7.4 The placement document shall also be placed on the website of the concerned stock exchange and of the issuer with a disclaimer to the effect that it is in connection with an issue to QIBs under this C....
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....I. 13A.11.2 The merchant banker shall exercise due diligence. 13A.11.3 The merchant banker shall furnish to each stock exchange on which the same class of shares or other securities are listed, a due diligence certificate stating that the issue is being made pursuant to this Chapter and complies with its requirements, along with the application made for seeking in-principle approval for listing of the specified securities. 13A.11.4 The merchant banker shall also furnish to each stock exchange on which the same class of shares or other securities are listed, the documents, undertakings, etc, if any, specified in the listing agreement for the purpose of seeking in-principle approval and final permission from Stock Exchanges for listing of the specified securities. 13A.12 Issuer Certification 13A.12.1 The issuer shall furnish a copy of the placement document to each stock exchange on which the same class of shares or other securities are listed. 13A.12.2 The issuer shall also furnish to each stock exchange on which the same class of shares or other securities are listed, a certificate stating that the issue is being made pursuant to this Chapter and complies wi....