DELIST OF SECUIRITY

8/7/2019 DELIST OF SECUIRITY

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History In the earlier days, the public issues of shares and

their pricing was looked after by the Controller of

Capital Issues (CCI).

1992, the same is being looked after by Securities

and Exchange Board of India (SEBI).

The purpose of establishing SEBI and the SEBI

Act, 1992 was to protect the interests of the investors

in securities and to romote the develo ment of, and


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Meaning

LISTING = STOCK EXCHANGES + COMPANY

DELISTING = STOCK EXCHANGES -COMPANY


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Delisting

Compulsory Voluntary


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publicnotice andinformationto allstockexchangeswherethesharesofthecompany arelisted and alsoonitstradingsystem

andwebsites

Appointmentofindependentvaluer

Determinationoffair valueofshares

Acquisitionofshares bythe promoters atdeterminedfair value

company/promoters/PAC/Directorscanneither accesssecuritiesnor seeklistingfor a periodof 10 years


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Voluntary delisting process flowchartConvene Board meeting to approve delisting & to appoint Merchant Banker &

otherintermediaries & send the outcome of the Board meeting tothe StockExchange.

Passspecial resolution through Postal Ballot.

File application tothe concerned Stock Exchange(s) fortaking approval

for Delisting along withthe auditreport.

Received approval fromthe concernedexchange

Calculation of Floorprice.


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Open Escrowaccount & depositthe amount equal tothe consideration to be payable

tothe outstanding Public Shareholders equityshares determined on the basisof Floor

price calculated above.

Public announcement bythe Promotersin atleastone English National

Daily,one Hindi National Dailywithwide circulation & one regional

language newspaperof the region where the concerned recognized Stock

Exchange is located.

Determine the listof Shareholderstowhomthe letter

of offeristo be sent.

Dispatchthe letterof offertothe public along withthe bidding

form & the formof tendering the sharesin the Reverse BookBuilding Process.

Opening of Offer.


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Date of Closing of Offer

Minimum Bidsreceived. Minimum Bids notreceived

Failure tooffer

Public announcementin the newspaper for acceptance/rejection or failure

of offer.

Promoter accepted

the final price

Promoter accepted the

final price


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Deposit additional amounttothe escrow

account & shall simultaneouslyopen special

accountin which all considerationdeposited in the Escrowaccountshall be

transferred.

Shall return the tendered

sharestothe shareholderswithin 10 working daysfromclosing of offer.

Paymenttothe shareholderswhohavetendered theirsharesin the bidding process

Final application tothe stock exchange

Delisting order bythe stock exchange

Remaining shareholderscan tendertheirsharesover a period of

one year atthe same price tothe promoter.

Release of EscrowAccount


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Comparison between Old & New

Regulations


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ParticularsSecurities And Exchange

Board of India (Delisting of

Securities) Guidelines, 2003

Securities And Exchange Board

of India (Delisting Of Equity

Shares) Regulations, 2009.

Coverage Allkindof Securities arecovered

Only Equity Shares areCovered

Definitions-Exchange Thereis a conceptofthe

DelistingExchange andExchange

Boththeearlier definitions

merged and a definitionofRecognized Stockexchangeis

inserted

Definitions-Public Shareholding The Publicshareholdingisthe

shareholdingin a companyof

the personsother thanthePromoters, Persons Actinginconcertwiththe Promoter

The publicshareholdingisthe

shareholdingin a companyof

the personsother thanthePromoters, Persons Actinginconcertwiththe Promoter ,

holdersof Depositors receiptsandthecustodianthereof .


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Particulars Securities And ExchangeBoard of India (Delisting

of Securities) Guidelines,

2003

Securities And Exchange

Board of India (Delisting Of

Equity Shares) Regulations,

2009.

Definitions-WorkingDays WorkingDays arenotdefined

Workingdays aredefined astheworkingdaysoftheSEBI.

Applicability Widely defined Not widely defined.

Inapplicability Not mentioned exclusively

and separately.

Separate section is made. The

exemption is available to the

companies which have been

declared sick & their

reconstruction scheme provides

the delisting including the

provisions of the exit option to

the shareholders.


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ParticularsSecurities And Exchange Board

of India (Delisting of Securities)

Guidelines, 2003


Board of India (Delisting Of

Equity Shares) Regulations,

2009.

Voluntary delisting The procedure and provisions of

both kind of Delisting a) Without

Exit option and b) With exit option

merged and no separate sections

were there.

The procedures for both kind of

Delisting a) Without Exit option

and b) With exit option are

defined and provided in an

identifiable manner.

Specified Date No concept of specified date, on

which the list of eligible public

shareholders can be determined to

whom the Letter of Offer will be

sent for Delisting.

The concept of Specified date

introduced, which is 30 days from

the date of the Public

Announcement, on which the

shareholders list be freezed towhom the letter of offer will be sent

for the Delisting.

Bidding period Only minimum time mentioned

during which the bidding Period

remain open which is 3 days

The bidding period will now be

3 days to 5 days and should

start within 55th day of the

public announcement.


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Particulars Securities And ExchangeBoard of India (Delisting of

Securities) Guidelines, 2003


Board of India (Delisting

Of Equity Shares)

Regulations, 2009.

Right of remaining shareholders The shareholders who could not participate

in the Delisting offer can offer their shares

to the promoters during a period of 6

months after the Delisting.

The shareholders who could not

participate in the Delisting offer can

offer their shares to the promoters

during a period of 1 year after the

Delisting.

Small Companies No special provisions are there for the

small companies. They have to follow

the same provisions as the Large and

big companies have to.

Special provisions under the

separate section be given for the

small companies and winding up

companies. They need not to

follow the Reverse Book Building

process.

Reinstatement of securities The companies cannot be relisted at

the exchange for a period of 2 years

from the period of delisting.

The companies delisted voluntarily

cannot be relisted for a period 5 years

and the companies compulsorily

delisted cannot be relisted for a periodof 10 years from the date of delisting


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Comparison between Voluntary and

Compulsory Delisting


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Criteria Compulsory DelistingVoluntary Delisting from all

the Exchange(s)

InitiativeAction Any Recognized Stock

Exchange makes an order to

delist the equity shares of a

company.

Any Company can voluntarily

apply to the concerned stock

exchange(s) for delisting.

Grounds Delisting order can be made on the

non-fulfillment of the listing

regulations of the respective

exchange and on any other ground

prescribed in the rules made under

section 21A of SCRA, 1956.

The Company either for cost

benefit, or to comply with any of

the rules and regulations etc may

seek delisting from any of the

exchange.

Public Notice Public Notice in this case be given

by the Exchange

Public notice and all

announcements be given by the

Promoters of the company.


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Criteria Compulsory Delisting Voluntary Delisting from

all the Exchange(s)

Approvals The Panel of Experts has to

take the decision after giving a

reasonable opportunity of

being heard to all the persons

who may be aggrieved by the

Delisting of the company.

The Company seeking

voluntary delisting shall take

the approval of the concerned

stock exchange(s) and also of

public shareholders.

General Meeting of the

shareholders

No need of the General

meeting of the shareholders

Shareholders resolution to be

passed through Postal ballot.

Appointment of Merchant

Banker

The complete process is

monitored by the Panel of

Experts

The complete process is

monitored by the Merchant

Bankers


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Criteria Compulsory Delisting Voluntary Delisting from allthe Exchange(s)

Exit Price To be calculated by the

Independent value at which the

Promoter should take the shares

from the Public shareholders.

The price to be determined on

the basis of the past trading data

or book values of the company

by the promoters in consultation

by the Merchant Banker

Reverse Book Building process No bids are invited from the

Shareholders for determination of

the Final Price

Complete process of Reverse Book

Building is to be completed for

determination of the Final Price.

Debarred from the securities

market

The company/

Promoters/Directors are

debarred from the securities

market for a period of 10 years

The company can not relist its

securities for a period of 5

years.


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ILLUSTRATIONS

ATLAS COPCO (INDIA) LTD.

VOLUNTARY DELISTING


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Company Profile The Companyis a public limited companyincorporated under

the Indian Companies Act, 1956, having its registered office at

Sveanagar, Mumbai Pune Road, Dapodi, Pune-411012, India.

The Equity Shares are listed on the Bombay Stock ExchangeLimited (BSE) and Pune StockExchange (PSE).

Atlas India is a company promoted by the Promoter. ThePromoter of the Company was holding 18,899,360 EquityShares on date 18-feb-2011 representing 83.77% of the paid

up equityshare capital of the Company.


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CONVENE BOARD MEETING On October 28, 2010, the Promoter informed the Company

of its intention to make the DelistingOffer and requested the

board of directors of the Company to convene a meeting toconsider the Delisting Offer and to communicate andrecommend the said proposal for approval by theshareholders in accordance with the delistingRegulations.


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The board of directors of the Company vide itsresolution dated October 29, 2010, approved theproposal received from the Promoter to initiate the

Delisting Offer in accordance with the provisions of theDelisting Regulations, subject to applicable law and toseekapproval of the shareholders of the Company.

A special resolution has been passed bythe shareholders

of the Companythrough postal ballot, the result of whichwas declared on December 24, 2010, approving theproposed delisting of the Equity Shares from the BSEand PSE in accordance with the DelistingRegulations.

SPECIAL RESOLUTION THROUGHPOSTAL BALLOT


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In-principal Approval By Stock

Exachange

The votes cast by Public Shareholders in favour ofthe Delisting offer were more than two times thenumber of votes cast by the Public Shareholdersagainst it. The BSE has issued its in-principleapproval to the Delisting Offer vide letter datedJanuary 25, 2011, subject to compliance with theDelistingRegulations.


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ReceiptofIn-principal Approval

The BSE hasissueditsin-principle approval

tothe DelistingOffer videletter dated January25, 2011,subjecttocompliancewiththe

DelistingRegulations.


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Calculation OfFloor Price Thefloor pricefor the Equity Shareswasdetermined

bythe Promoter inconsultationwith Manager tothe

Offer to be ` 1426/- (Rupees One Thousand FourHundred Twenty Six Only) per equityshare.

The Floor Pricewas arrived at as per the ValuationReportdated 18th November, 2010 ofM/s. SSPA &Co.,theChartered Accountants .


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ESCROW ACCOUNT

In accordance with the Delisting Regulations, the Promoter,Citibank NA (the Escrow Bank) and the Manager to the

Offer have entered into an escrow agreement dated February7, 2011 subsequent to which the Promoter has opened anescrowaccount with the EscrowBankat their branch at D.N.Road, Fort, Mumbai-400.001.

The Escrow Bank has issued, pursuant to bank guaranteeletter dated February 17, 2011 in favour of the MerchantBanker for an aggregate amount of `550,00,00,000/- (Fivehundred and FiftyCrores Rupees only).


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PUBLIC ANNOUNCEMENT The Public Announcementhas beenissuedinthe

followingnewspapers as requiredunder Regulation

10(1) ofthe DelistingRegulations:NEWSPAPER LANGUAGE EDITIONS

Business Standard English & Hindi ALL

Loksatta Marathi Pune


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CONTD..

An public announcementconsistsoffollowing

The floor price and the offer price and how theywere arrivedat.

The dates of openingand closing of the offer.

The name of the exchange from which the equity shares aresought to be delisted.

The manner in which the offer can be accepted by the

shareholders.


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PROPOSED TIMETABLE FOR

THE OFFER

ACTIVITY DATE

Date of publication of the PA February 18, 2011

Specified Date for determining the names of shareholders to

whom the Offer Letters shall be sent

February 18, 2011

Dispatch of Offer Letters/Bid Forms to Public Shareholders as on

Specified Date

February 22, 2011

Bid OpeningDate (10.00 am) March 7, 2011

Bid ClosingDate (3.00 pm) March 11, 2011

Announcement of Discovered Price/Exit Price and the PromotersAcceptance/Non-acceptance of Discovered Price/Exit Price

March 23, 2011

Return of Equity Shares to shareholders i n case of f ailure of

DelistingOffer/Bids have not been accepted

March 25, 2011


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ACCEPTANCE OF FINAL PRICE If promoter accept the final price then he will

deposit the additional amount in the escrow

account and will simultaneouslyopen a special

account which shall be used for payment to

the Public Shareholders who have tendered

Equity Shares in the DelistingOffer


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FINAL STEPS

Paymenttotheshareholderswhohavetenderedtheresharesinthe

biddingprocess

Final applicationtostockexchange

Delistingorder bystockexchange


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Documents

DELIST OF SECUIRITY