TaxTMI 
TaxTMI 
SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 1994
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.... the acquirer; (c) "investigating officer" means any officer of the Board, or any other person, having experience in dealing with the problems relating to the securities market, and such person is authorized by the Board under Chapter V of these regulations; (d) "person acting in concert" comprises persons who, pursuant to an agreement or understanding acquires or agrees to acquire shares in a company for a common objective or purpose of substantial acquisition of shares and includes: i. a company, its holding company, or subsidiaries of such companies or companies under the same management either individually or all with each other; ii. a company with any of its directors, or any person entrusted with the management of the funds of the company; iii. directors of companies, referred to in clause (i) and his associates; and iv. mutual fund, financial institution, merchant banker, portfolio manager and any investment company in which any person has an interest as director, fund manager, trustee, or as a shareholder having not less than 2% of the paid-up capital of that company. Explanation - For the purposes of this clause "associate" mean....
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....acquired by the existing shareholders of that company or any of its holding company or of a company under the same management, may pass an order of exemption from the provisions of Chapter III after recording the reasons in writing for grant of such exemption. CHAPTER II DISCLOSURES OF SHAREHOLDING 5) Transitional provision. - (1) Any person, who holds more than five per cent shares in any company, shall within two months of notification of these regulations disclose his aggregate shareholding in that company, a) to all the stock exchange on which the shares of the said company are listed, and b) to the aforesaid company. (2) Every company whose shares are held by the persons referred to in sub-regulation (1) shall disclose to the stock exchange within two months from the date of notification of these regulations the aggregate number of shareholdings of each of the acquirer referred above. 6) Acquisition of 5% and more shares of a company. - (1) Any acquirer, who holds five per cent or less than five per cent shares in a company and acquires more than five per cent shares: - a) in pursuance of a public issue, or b) by one or more transactions, or c) in....
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....ffer price from the other shareholders of the company in accordance with these regulations. 3) Where an acquirer acquires securities which would entitle him more than ten per cent of the voting rights together with voting rights on shares already held by him, then, such person shall make a public announcement referred to in sub-regulation (1) at the time immediately before his entitlement to obtain voting rights on such securities. 4) Nothing in sub-regulation (2) shall apply to any person, who on the date of coming into force of these regulations holds shares carrying more than ten per cent of the voting rights in the capital of a company, if he has already complied with the provisions of clause 40A and clause 40B of the listing agreement of any stock exchange. 10) Acquisition of 10% or more of the shares of any company through open market purchases. - 1) An acquirer, who holds shares carrying ten per cent or less of voting rights in the capital of the company shall not acquire any further shares in the company from the open market which when taken together with his existing shareholdings, would carry more than ten per cent of the voting rights, unless such acquirer ma....
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....as entered into an agreement or memorandum of understanding to acquire the shares; v. Intention of acquisition of shares; vi. The record date and the date by which individual letter of offers would be posted to the shareholder and the manner and date by which the acceptance or otherwise of offer should be communicated; vii. The time and manner of payment of consideration for acquisition of shares; viii. All conditions subject to which the offer is made including the following conditions, namely: - a) the total number of shares to be acquired from the public, subject to a minimum as specified in regulation 21; b) the statutory approvals under the Companies Act, 1956 (1 of 1956), Monopolies Restrictive Trade Practices Act, 1969 (54 of 1969) and Foreign Exchange Regulation Act, 1973 (46 of 1973) required to be obtained for the purpose of acquiring the shares; and required to be obtained for the purpose of acquiring the shares; and c) approvals to be obtained from shareholders of the company of which the shares are being acquired; ix. Such other information in the investors interest having a bearing on the substantial acquisition of shares. ....
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....last six months preceding the date of announcement, whichever is higher, provided there has been a market for such shares during that period in that stock exchange; b) In case of acquisition of shares under regulation 10, the highest price paid by the acquirer in the open market or the average of the weekly high and low of the closing prices of the shares as quoted on the stock exchange during the last six months preceding the date of announcement, whichever is higher, provided there has been a market for such shares during that period in that stock exchange; c) Where there has been no continuous market in the stock exchange for the share to be acquired, such average shall be calculated on the basis of weighted average prices quoted in at least one other stock exchange to the determined on the basis of the daily trading volume of such shares in that exchange or in any other reasonable manner with the prior approval of the Board; d) In case where the shares of the company are offered in lieu of cash payment, the value of such shares shall be determined in the same manner as mentioned in clauses (a) and (b) as the case may be. 20) General obligations. - (1) The announceme....
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....s. 21) Minimum number of shares to be acquired. - (1) Subject to sub-regulation (2), the offer shall be made to acquire shares from each of the shareholders, such member of shares, which shall not be less than the minimum marketable lot as determined by the Stock Exchange in which these shares are listed, or the entire holding if it is less than the marketable lot. 2) The public offer shall be made to the remaining shareholders of the company, to acquire from them an aggregate minimum of 20 per cent of the total shares of that company. 3) Where an acquirer holds more than ten per cent shares at the time of commencement of these regulations and was not required to comply with the provisions of clause 40A and clause 40B of the Listing Agreement, the public offer referred to in sub-regulation (2) shall be to acquire a minimum of such percentage as would increase his shareholding to atleast thirty per cent of the total shares of that company. 4) The offer referred to above shall not result in the public shareholding being reduced to less than 20 per cent of the voting capital of the company. 5) Where a person seeking to make acquisition of shares by reason of holding sec....
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..... the acquirer being a company or a body corporate has either received notice or is subject to commencement of winding up proceedings 4) In the event of withdrawal of the offer under any of the conditions, the acquirer shall make a public announcement in the same newspapers in which the announcement of offer was published, indicating reasons for withdrawal of the offer. 5) Where an offer is withdrawn under sub regulation (1) the acquirer shall not make any offer for acquisition of shares in the same company for a period of 6 months from the date, the offer is withdrawn. CHAPTER IV Bail out takeovers 26) Bail out takeovers. - (1) The provisions of the Chapter shall apply to a substantial acquisition of shares to financially weak company not being a stick industrial company, in pursuance to a scheme of rehabilitation approved by a public financial institution or a scheduled bank; (hereinafter referred to as lead institution). 2) The lead institution shall be responsible for ensuring compliance with the provisions of this Chapter. 3) The lead institution shall appraise the financially weak company taking into account the financial viability, and assess the require....
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....valuation as provided in sub-regulation (1), the offers received shall be listed in order of preference and after consultation with the persons in the affairs of the management of the financially weak company accept one of the bids. 29) Person acquiring shares to make an offer. - The person acquiring shares who has been indentified by the lead institution under regulation 27, shall on receipt of a communication in this behalf from the lead institution make a formal offer to acquire the shares from the promoters or persons in charge of the affairs of the management of the financially weak company, financial institutions and also other shareholders at a price determined by mutual negotiation between the person acquiring shares and the lead institution. Explanation - Nothing in this regulation shall prohibit the lead institution offering the shareholdings held by it to financially weak company as part of the scheme of rehabilitation. 30) Person acquiring shares to make public announcement in certain cases. - (1) Where an offer is made to the shareholders other than the persons in charge of the management of the affairs of the financially weak company, the person acquiring sha....
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....may appoint one or more persons as investigating authority to investigate and undertake inspection of the books of accounts, other records and documents of any person who may have acquired or sold securities to any person for any of the purposes specified in sub-regulation (2). (2) The purposes referred to in sub-regulation (1) may be as follows: a) to investigate into the complaints received from investor, intermediaries or any other person on any matter having a bearing on the allegations of substantial acquisition of shares and take-overs; and b) to investigate suo-moto upon its own knowledge or information, in the interest of securities business or investors interests, for any breach of the regulations. 34) Procedure for investigation. - (1) Before undertaking any investigation under regulation 33 the Board shall give a reasonable notice to the person concerned for that purpose. (2) Notwithstanding anything contained in sub-regulation (1), where the Board is satisfied that in the interest of the investors or in public interest no such notice should be given, it may be an order in writing direct that the investigation be taken up without such notice. (3) On bei....