Sebi exempts family trust related to Batliboi from making open offer

Team Udayavani, Jul 6, 2018, 5:56 PM IST

New Delhi: Market regulator Sebi today exempted a private family trust related to the promoter group of Batliboi Ltd from the obligation of making an open offer following its proposed acquisition of additional 49.55 per cent stake in the firm.

Bhogilal Family Trust had sought exemption from the obligation of making open offer post acquisition of certain number of shares in Batliboi Ltd.

Under the proposed acquisition, the trust would be acquiring 49.55 per cent equity shares of Batliboi Ltd from the company’s promoter Nirmal Bhogilal, who is also trustee of Bhogilal Family Trust.

The stock would be acquired in different tranches in the coming years by way of contribution (gift) through open market transactions, as per the proposal.

The proposal has been made following a private family arrangement to provide for family succession and welfare of Bhogilal’s family.

Earlier, the trust had acquired 15.67 per cent of the total shareholding of the company from Bhogilal in March 2017 after obtaining approval from Sebi and has been named as a part of the promoter group in the shareholding pattern filed by the company for the quarter ending March 2017.

In an order passed today, Sebi has granted exemption to the trust from making the open offer, saying the proposed acquisition would take place pursuant to a private family arrangement intended for succession and welfare of the Nirmal Bhogilal’s family.

Besides, the proposed acquisition will not affect the interest of the public shareholders and there will be no change in control of the company pursuant to the proposed acquisition, noted Sebi.

According to the SAST (Substantial Acquisition of Shares and Takeovers) Regulations, an entity buying 25 per cent stake in a listed firm will have to mandatorily make an open offer to buy an additional 26 per cent shares from the public shareholders 

The regulator has laid certain conditions while providing exemptions, including that the proposed acquisition should be in accordance with the relevant provisions of the Companies Act and other applicable laws.

“On completion of the proposed acquisition, the acquirer (trust) shall file a report with Sebi within a period of 21 days from the date of such acquisition, as provided in the Takeover Regulations,” said whole time member G Mahalingam.