2009 (12) TMI 1056

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....) 1. By order dated June 16, 2009 the whole time member of the Securities and Exchange Board of India (for short the Board) has declined to exempt from the provisions of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (for short the takeover code) M/s. Futuristic Garments Pvt. Ltd., the acquirer in respect of its proposed acquisition ....

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.... issue 47 lac optionally convertible share warrants to the acquirer which is one of its promoters. It is common ground between the parties that on the conversion of these optionally convertible warrants into equity shares, the stake of the promoters in the target company would go up to 51 per cent of its enhanced share capital. It is admitted on behalf of the appellant that in pursuance to the res....

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....nsel on behalf of the respondent Board. Having perused the impugned order, we are of the view that the reasons mentioned by the whole time member in paragraph 6.3 of the impugned order for declining the exemption do not appear to be tenable. However, even if the impugned order were to be set aside, no substantial relief can be granted to the appellant in the facts and circumstances of the present ....

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....eover code would get attracted. Warrants by themselves do not carry any voting rights. The acquirer will acquire voting rights only when the warrants are converted into equity shares and till such time such conversion takes place, the takeover code does not get triggered. In this background, we find that the request of the appellant seeking exemption from the provisions of the takeover code is pre....