Post on 12-Sep-2015
Takeover Panorama A Monthly Newsletter by Corporate Professionals
Year VIII-Vol X
November - December Edition
2
Legal Update
SAT order in the matter ofM/s. BTL Holding Company Limited
SAT order in the matter ofM/s. GulabImpex Enterprises Limited
SAT order in the matter of Mr. AshleshGunvantbhai Shah
SAT order in the matter of Mr. VirendraKumar Jayantilal Patel
Consent order in the matter of M/s. Delta Industrial Resources Limited
Consent order in the matter of M/s. Abhijit Trading Company Limited
Consent order in the matter of M/s. Gavis Pharma LLC
Consent order in the matter of M/s. Sabero Organics Gujarat Limited
Consent order in the matter of M/s. Archana Software Limited
Consent order in the matter of M/s. Advik Laboratories Limited
Consent order in the matter of M/s. Shree Manufacturing Company Limited
Consent order in the matter of M/s. Automobiles Products of India Limited
Consent Order in the matter of M/s.Mahesh Agricultural Implement and Steel
Forgings Limited
Consent order in the matter of M/s. AAR KAY Steel Products Limited
Consent order in the matter of M/s. Artech Power Products Limited
Consent order in the matter of M/s. Tak Machinery and Leasing Limited
Adjudicating Officer/WTM Orders
3
Latest Open Offers
17
Regular Section
21
Market Update
23
Our Team
24
Insight
3
The Honble Tribunal held that
since the Appellant himself on
becoming aware of the technical
violation in question approach
SEBI, therefore reduced the
penalty imposed to 5 lac on
fulfilling the condition prescribed
by SAT.
SAT order in the matter of M/s. Gulab Impex Enterprises Limited
Facts:The present appeal is filed by M/s.GulabImpex
Enterprises Limited (Appellant) against the initiation
of Adjudication proceeding by SEBI and imposed a
penalty of Rs. 9,00,000 for violation of Regulation
8(3) of SEBI (SAST) Regulations, 1997 instead of
favorably considering the consent application for an
amicable resolution of the issue.
Brief facts of the case:
GulabImpex Enterprises Limited (Appellant) is a company incorporated under
Companies Act, 1956 and the shares of the Company are listed at Delhi Stock Exchange
Limited and UP Stock Exchange Limited.
Appellant had failed to file the disclosures as required under Regulation 8(3) of SEBI
(SAST) Regulations, 1997 for the year 1998 to 2011. Accordingly SEBI imposed the
penalty of 9,00,000 for the aforesaid violations on the Appellant. Being aggrieved by the
direction of SEBI, the appellant has filed the appeal before Honble Tribunal and
contended the following:
The two stock exchanges, where the shares of the companyare listed, namely,
Delhi Stock Exchange and UP Stock Exchange, are nonfunctionaland no trading is
being carried on by the investors or shareholders in the scrip of theappellant
company since last many years.
They had been disclosing regularly the shareholdings under Regulation 8(3) of
SEBI (SAST) Regulations, 1997. However, in respect of 2001 there was an
inadvertent noncompliance. It was revealed to them by the company secretary and
they tookimmediate steps to approach SEBI by disclosing the violation. SEBI
instead offavorably considering the consent application for an amicable resolution
of the issue, conducted adjudication proceedings and passed the impugned order
in question.
Issues: Whether the penalty imposed by the SEBI is justified?
LEGAL
UPDATES
4
The Honble Tribunal held that the
sale of shares in question were
reported on BSEs website in bulk
deal data and disclosures under
the Listing Agreement to BSE,
does not absolve the appellant
from making disclosures under
SEBI (SAST) Regulations, 2011
and SEBI (PIT) regulations, 1992.
Decision:After taking into considerations all the facts and circumstances of the case, the
Honble Tribunal (SAT) observed that the appellant on his own approached SEBI on
becoming aware of the technical violation in question and asked for consent proceedings
which, somehow, could not materialize. SAT further observed that the conduct of appellant
in approaching SEBI on its own and thereby bringing the violation in question to the notice of
SEBI.
As against the above order passed by SEBI, after considering all mitigating factors, SAT
held that ends of justice would be met with by disposing of this appeal and directed
Appellant to make disclosure as per Regulation 8(3) of SEBI (SAST) Regulation, 1997 on or
before November 17, 2014 and after the required disclosure is made by the Appellant, the
penalty of Rs. 9 lacs imposed on the appellant shall stand modified to Rs. 5 lacs. In case the
appellant does not make appropriate disclosure by November 17, 2014, the original penalty
against the company shall revive.
SAT order in the matter of Mr. Ashlesh Gunvantbhai Shah
Facts:
The present appeal is filed by Mr. AshleshGunvantbhai Shah (hereinafter referred to as
Appellant) against the order passed by SEBI (hereinafter referred to as Respondent)
imposing a penalty of Rs. 5,00,000/- on the appellant for the violation of Regulation 29(2) of
SEBI (SAST) Regulations, 2011 and Regulation 13(3) of SEBI (PIT) Regulations,1992.
Brief facts of the case:
On May 02, 2013, Appellant had disposed off
74,547 shares representing 6.2% of the total
shareholding of Parichay Investments Limited
(hereinafter referred to as Target
Company).However no disclosures has been filed
to the Stock Exchange as required under Regulation
29(2) of SEBI (SAST) Regulations, 2011
andRegulations 13(3) of SEBI (PIT) Regulations,
1992. Accordingly SEBI imposed the penalty of 5,00,000 for the aforesaid violations on the
Appellant. Being aggrieved by the direction of SEBI, the appellant has filed the appeal before
Honble Tribunal and contended the following:
Sale of shares effected by the appellant on May 2, 2013 werereported on Bombay Stock
Exchange (BSE)s website in the bulkdeal data and therefore failure on part of the
5
appellant to makedisclosures being technical violation, penalty of Rs.5 lac oughtnot to
have been imposed upon appellant.
Target Company had also made shareholding patternrelated disclosures under the
Listing Agreement to BSE which was also publicly available on BSE website.
Appellant being a lay investor was not aware of the obligationto make disclosures.
No loss, harm or injury was caused to any investor on accountof nondisclosure on part
of appellant.
Immediately on receipt of showcause notice,appellant made disclosures on 26th
February, 2014. Therefore,delay in making disclosures being unintentional, technical and
inadvertent.
Issues: Whether the penalty of Rs.5 lacs imposed on the appellant for violation of
Regulation 29(2) of SEBI (SAST) Regulations, 2011 and violation of Regulation 13(3) of
SEBI (PIT) Regulations, 1992 is justified?
Decision:After considering the facts and circumstances of the case,The Honble Tribunal
observed that the sale of shares in question were reported on BSEs website in bulk deal
data, does not absolve the appellant from making disclosures under the respective
regulations. Similarly, fact that the company had made disclosures under the Listing
Agreement to BSE would also not absolve the appellant from making disclosures under the
respective regulations. Therefore, the appeal is, accordingly, dismissed.
SAT order in the matter of Mr. VirendrakumarJayantilal Patel
Facts:
The present appeal is filed by Mr. VirendrakumarJayantilal Patel (hereinafter referred to as
Appellant) against the order passed by SEBI (hereinafter referred to as Respondent)
imposing a penalty of Rs. 5,00,000/- on the appellant for the violation of Regulation 29(2) of
SEBI (SAST) Regulations, 2011 and Regulation 13(3) of SEBI (PIT) Regulations,1992.
Brief facts of the case:
On May 02, 2013, Appellant had disposed off 64,770 shares representing 5.4% of the
total shareholding of Parichay Investments Limited (hereinafter referred to as Target
Company). However no disclosures has been filed to the Stock Exchange as required
under Regulation 29(2) of SEBI (SAST) Regulations, 2011 andRegulations 13(3) of SEBI
6
The Honble Tribunal held that the
sale of shares in question were
reported on BSEs website in bulk
deal data and disclosures under
the Listing Agreement to BSE,
does not absolve the appellant
from making disclosures under
SEBI (SAST) Regulations, 2011
and SEBI (PIT) regulations, 1992.
(PIT) Regulations, 1992 Accordingly SEBI imposed the penalty of 5,00,000 for the
aforesaid violations on the Appellant. Being aggrieved by the direction of SEBI, the
appellant has filed the appeal before Honble Tribunal and contended the following:
Sale of shares effected by the appellant on May
2, 2013 werereported on Bombay Stock
Exchange (BSE)s website in the bulkdeal data
and therefore failure on part of the appellant to
makedisclosures being technical violation,
penalty of Rs.5 lac oughtnot to have been
imposed upon appellant.
Target Company had also made shareholding
patternrelated disclosures under the Listing
Agreement to BSE which was also publicly
available on BSE website.
Appellant being a lay investor was not aware of the obligation to make disclosures.
No loss, harm or injury was caused to any investor on accountof nondisclosure on part
of appellant.
Moreover, learned counsel of Appellant contended that Appellant is a blind person, so
AO ought to have taken a lenient view and ought not have imposed penalty of Rs. 5 lacs.
Immediately on receipt of showcause notice,appellant made disclosures on 26th
February, 2014. Therefore,delay in making disclosures being unintentional, technical
andinadvertent.
Issues:Whether the penalty of Rs.5 lacs imposed on the appellant for violation of Regulation
29(2) of SEBI (SAST) Regulations, 2011 and violation of Regulation 13(1) of SEBI(PIT)
Regulations, 1992 is justified?
Decision:After considering the facts and circumstances of the case, The Honble Tribunal
observed that the sale of shares in question were reported on BSEs website in bulk deal
data, does not absolve the appellant from making disclosures under the respective
regulations. Though, as per the contentions that AO ought to have taken a lenient view as
the Appellant is a blind person is unjustified because though being a blind person, Appellant
was dealing in shares of various companies and his investments in the shares of Target
Company was about Rs. 50 lacs. Similarly, fact that the company had made disclosures
under the Listing Agreement to BSE would also not absolve the appellant from making
disclosures under the respective regulations. Therefore, the appeal is, accordingly,
dismissed.
7
The Honble Tribunal held
that once the Appellant has
accepted its obligation to
make disclosure and has in
fact, made disclosures
belatedly it is not open to the
appellant being the merged
entity to deny obligation to
discharge any liability.
SAT order in the matter of M/s. BTL Holding Company Limited
Facts:The present appeal is filed by M/s. BTL Holding
Company Limited (Appellant) against the order passed
by SEBI imposing a penalty of Rs. 20,00,000 on the
Appellant for the violation of Regulation 29(2) of SEBI
(SAST) Regulations, 2011 and Regulation 13(3), 13(4A),
13(5) and 13(6) of SEBI (PIT) Regulations, 1992.
Brief facts of the case:
1. On March 16, 2012 pursuant to High Court order, 22
promoters/ promoters group of SRS Limited merged
with BTL Industries Limited which resulted in 5,59,18,350 (40.14%) shares of SRS
Limited, held by 20 out of 22 promoter/promoter group stood vested in BTL industries
Limited (Name changed to SRS Holding Limited w.e.f. April 19, 2013).
2. Thereafter on July 18, 2013, SRS Holding India Limited merged with BTL Investments
and Securities Limited (Name changed to BTL Holding Company Limited w.e.f.
September 30, 2013) resulted in 5,59,18,350 (14.77%) shares of SRS Limited held by 20
out of 22 promoter/promoter group entities were transferred to BTL Industries Limited.
3. Thus, the total shareholding of BTL Industries in SRS Limited after the merger became
7,64,85,905 shares (2,05,67,555+5,59,18,350) which constituted 54.91% of the total
shares issued by SRS Limited.
4. Therefore 19 entities which held shares in excess of 25,000 sharesof SRS Limited were
required to make disclosures under regulation 13(4A) read with regulation 13(6) of SEBI
(PIT) Regulations, 1992 and some of the entities were also required to make disclosures
under regulation 29(2) of SEBI (SAST) Regulations, 2011. Similarly, on transfer of shares
of SRS Limited, BTL Industries Limited was required to make disclosures under
Regulation 13(3) read with Regulation 13(5), Regulation 13(4A) read with Regulation
13(6) of SEBI (PIT) Regulations, 1992 and Regulation 29(2) of the SEBI (SAST)
Regulations, 2011. Further From the records it is seen that BTL Industries Limited made
disclosures belatedly under Regulation 13(4A) of SEBI (PIT) Regulations, 1992 and
under regulation 29(2) of SEBI (SAST) Regulations, 2011. However, no disclosures were
made under regulation 13(3) of SEBI (PIT) Regulations, 1992.
5. Accordingly SEBI imposed the penalty of 20,00,000 for the aforesaid violations on the
Appellant. Being aggrieved by the direction of SEBI, the appellant has filed the appeal
before Honble Tribunal and contended the following:
8
i. In the absence of any show cause notice issued to the appellant, liability arising
from the show cause notices issued to the 20 entities could not be fastened upon
the appellant merely because the appellant represented those entities before the
Adjudicating Officer.
ii. 19 promoter/promoter group entities were not required to make disclosures under
the PIT Regulations, because on September 7, 2012/September 21, 2012 when
shares of SRS Limited were transferred, all the 19 entities stood dissolved, on
account of the effective date of merger being prior to the date of transfer of shares.
Similarly, effective date of merger of SRS Holding India Limited with BTL
Investments and Securities Limited is September 18, 2013, whereas show cause
notice is issued to SRS Holding Limited on January 3, 2014 i.e., after SRS Holding
India Limited stood dissolved on account of merger. Therefore, proceedings initiated
against a dissolved entity being bad in law, the impugned order is liable to be
quashed and set aside.
iii. Pursuant to the order passed by the Delhi High Court On July 18, 2013 approving
merger of SRS Holding India Limited with BTL Investments and Securities Limited,
only proceedings pending by or against SRS Holding India Limited as on the
effective date could be continued by or against BTL Investments and Securities
Limited/appellant. In the present case, the show cause notice is issued after the
effective date and therefore, the proceedings are vitiated.
Issues: Whether the penalty imposed by the SEBI is justified?
Decision:SAT observed that by operation of the first order passed by Delhi High Court on
March 16, 2012 rights and obligations of 19 promoter/promoter group entities were liable to
be discharged by SRS Holding India Limited and pursuant to the second order of Delhi High
Court dated July 18, 2013 rights and obligations of SRS Holding India Limited were liable to
be discharged by BTL Investments and Securities Limited and only due to change of name
by the appellant, the appellant cannot escape liability to discharge the penalty imposed on
19 promoter/promoter group entities and SRS Holding India Limited. Further If the shares of
SRS Limited held by 19 merged entities could be transferred after the effective date of
merger, there is no reason as to why disclosure obligations arising on account of transfer of
shares of SRS Limited held by 19 merged entities could not be discharged by SRS Holding
India Limited. Further, Once SRS Holding India Limited has accepted its obligation to make
disclosure and has in fact, made disclosures belatedly it is not open to the appellant being
the merged entity of SRS Holding India Limited to deny obligation to discharge the penal
liability imposed on SRS Holding India Limited for the delayed disclosures. Therefore, The
appeal is, accordingly, dismissed.
9
Consent order in the matter of M/s. Delta Industrial Resources Ltd
M/s Delta Industrial Resources Limited (Applicant) has voluntarily filed the consent
application in respect of delayed compliance of Regulation 6(2), 6(4) and 8(3) of SEBI
(SAST) Regulation, 1997 for the years 1998 to 2011. It was noted that since considerable
time has passed since SEBI (SAST) Regulation, 1997 came into force, therefore for the
purpose of formulating the settlement amount non-compliances of Regulation 6(2) and 6(4)
of SEBI (SAST) Regulations, 1997 cannot be considered.
Accordingly, The applicant proposed to settle the above non-compliances of 8(3) on the
payment of Rs. 6,45,000 towards settlement charges. The terms as proposed by the
applicant were placed before High Power Advisory Committee (HPAC) and on the
recommendation of HPAC, SEBI settle the above non compliances.
Consent order in the matter of M/s. Abhijit Trading Company Ltd
M/s. Abhijit Trading Co Ltd. (Applicant) has voluntarily filed the consent application in
respect of delayed compliance of Regulation 6(2), 6(4) and 8(3) of SEBI (SAST) Regulation,
1997 for the years 1998 to 2011. It was noted that since considerable time has passed since
SEBI (SAST) Regulation, 1997 came into force, therefore for the purpose of formulating the
settlement amount non-compliances of Regulation 6(2) and 6(4) of SEBI (SAST)
Regulations, 1997 cannot be considered.
Accordingly, The applicant proposed to settle the above non-compliances of 8(3) on the
payment of Rs. 6,41,250towards settlement charges. The terms as proposed by the
applicant were placed before High Power Advisory Committee (HPAC) and on the
recommendation of HPAC, SEBI settle the above non compliances.
Consent order in the matter of M/s.Gavis Pharma LLC
SEBI had initiated adjudication proceedings against M/s GAVIS Pharma LLC., USA
(Applicant) for the alleged violation of the provisions of 74(3) of SEBI (Issue of Capital and
Disclosure Requirements) Regulations, 2009) read with Regulation 22(1) of SEBI (SAST)
Regulations, 2011 during the year 2013 as observed from the offer documents filed with
SEBI by MGAVIS Pharma LLC. (Acquirer) to acquire upto 26,06,303 shares of face value
of Rs. 10/- each representing 26% of the share capital of M/s. Wintac Limited (Target
Company).
10
Pending the adjudicating proceedings, the Applicant has filed the consent application for the
settlement of above violations and proposed to pay a sum of Rs. 2,00,000 towards
settlement charges. The terms as proposed by the Applicant were placed before High
Powered Advisory Committee (HPAC) and on the recommendation of HPAC, SEBI settle the
above non compliances and disposes of said proceedings against the Applicant.
Consent order in the matter of M/s. Sabero Organics Gujarat Limited
SEBI had initiated adjudication proceedings against M/s Sabero Organics Gujarat Limited
(Applicant/SOGL) for the alleged violation of the provisions of Regulation 8(3) and
Regulation 7(3) of the SEBI (SAST), 1997 as observed from the offer documents filed with
SEBI by M/s. Coromandel International Limited (Acquirer) to acquire upto 1,05,00,000
shares of face value of Rs. 10/- each representing 31% of the share capital of SOGL.
Pending the adjudicating proceedings, the Applicant has filed the consent application for the
settlement of above violations and proposed to pay a sum of Rs 12,36,750 towards
settlement charges. The terms as proposed by the Applicant were placed before High
Powered Advisory Committee (HPAC) and on the recommendation of HPAC, SEBI settle the
above non compliances and disposes of said proceedings against the Applicant.
Consent order in the matter of M/s. Archana Software Limited
SEBI had initiated adjudication proceedings against M/s Archana Software Limited
(Applicant) for the alleged violation of the provisions of Regulation 8(3) of the SEBI (SAST),
1997 by 2292 days, 1927 days, 1562 days, 1196 days, 831 days, 466 days, 1018 days, 652
days, 287 days, 292 days for the years 2001 to 2010 and had not complied for year 2011.
Pending the adjudicating proceedings, the Applicant has filed the consent application for the
settlement of above violations and proposed to pay a sum of Rs 5,22,750 towards settlement
charges. The terms as proposed by the Applicant were placed before High Powered
Advisory Committee (HPAC) and on the recommendation of HPAC, SEBI settle the above
non compliances and disposes of said proceedings against the Applicant.
Consent order in the matter of M/s. Advik Laboratories Limited
SEBI had initiated adjudication proceedings against V. K. Jain (HUF) (Applicant 1) and
Divya Jain (Applicant 2) who are part of promoter group of M/s Advik Laboratories Limited
(Target Company/ALL) for the alleged violation of the provisions of Regulation 29(2) and
11
Regulation 29(3) of the SEBI (SAST), 2011for the year 2011 and also for violation of
Regulation 13(4A) read with Regulation 13(5) of SEBI (PIT) Regulations, 1992 as observed
from the draft letter of offer filed with SEBI by M/s. Omkam Pharmaceuticals Limited
(Acquirer) to acquire upto24,31,884equity shares of face value of Rs. 10/- each
representing 26% of the paid-up equity share capital of ALL.
Pending the adjudicating proceedings, the Applicant 1 and Applicant 2 has filed the consent
application for the settlement of above violations and proposed to pay a sum of Rs
2,47,190.65 and Rs. 2,61,731.25 towards settlement charges. The terms as proposed by the
Applicant were placed before High Powered Advisory Committee (HPAC) and on the
recommendation of HPAC, SEBI settle the above non compliances and disposes of said
proceedings against the Applicant.
Consent order in the matter of M/s. Shree Manufacturing Company
Limited
SEBI had initiated adjudication proceedings against M/s Shree Manufacturing Company
Limited (Applicant/SMCL) for the alleged violation of the provisions of Regulation 8(3) of
the SEBI (SAST), 1997 as observed from the offer documents filed with SEBI by M/s. Edge
Consultancy Services LLP (Acquirer) to acquire upto 14,81,902 shares of face value of Rs.
10/- each representing 26% of the share capital of SMCL.
Pending the adjudicating proceedings, the Applicant has filed the consent application for the
settlement of above violations and proposed to pay a sum of Rs. 5,10,000 towards
settlement charges. The terms as proposed by the Applicant were placed before High
Powered Advisory Committee (HPAC) and on the recommendation of HPAC, SEBI settle the
above non compliances and disposes of said proceedings against the Applicant.
Consent order in the matter of M/s. Automobile Products of India Ltd
SEBI had initiated adjudication proceedings against M/s Automobile Products of India
Limited (Applicant) for the alleged violation of the provisions of Regulation 8(3) of the SEBI
(SAST), 1997 by 4708 days, 4343 days, 3977 days, 3612 days, 3247 days, 2882 days, 2516
days, 2151 days, 1786 days, 1421 days, 1055 days, 690 days and 325 days for the year
1998 to 2010.
12
Pending the adjudicating proceedings, the Applicant has filed the consent application for the
settlement of above violations and proposed to pay a sum of Rs 6,63,000 towards settlement
charges. The terms as proposed by the Applicant were placed before High Powered
Advisory Committee (HPAC) and on the recommendation of HPAC, SEBI settle the above
non compliances and disposes of said proceedings against the Applicant.
Consent order in the matter of M/s. Mahesh Agricultural Implement
and Steel Forgings Limited
SEBI had initiated adjudication proceedings against M/s. Mahesh Agricultural Implement and
Steel Forgings Ltd (hereinafter referred to as Applicant) and alleged that the applicant had
delayed in complying with Regulation 8(3) of SEBI (SAST), Regulations,1997 by 3176 days,
2811 days, 2446 days, 2081 days, 1716 days, 1351 days, 986 days, 621 days and 256
daysduring the year 2003 to 2011 respectively.
Pending the adjudicating proceedings, the Applicant has filed the consent application to
settle the above noncompliance on the payment of Rs. 4,56,875 towards settlement
charges. The term as proposed by the Applicant were placed before High Powered Advisory
Committee (HPAC) andHPAC recommended that the case may be settled on payment of
Rs. 4,56,875 /-, accordingly SEBI settle the above non compliances and disposes of said
proceedings against the Applicant.
Consent order in the matter of M/s. AAR KAY Steel Products Limited
SEBI had initiated adjudication proceedings against M/s. AAR KAY Steel Products Limited
(hereinafter referred to as Applicant) and alleged that the applicant had delayed in
complying with Regulation 8(3) of SEBI (SAST), 2011 by 4058 days, 3693 days, 3327 days,
2962 days, 2597 days, 2232 days, 1866 days, 1501 days, 1136 days, 771 days, 405 days,
1081 days, 716 days and 351 days during the year 1998 to 2011 respectively.
Pending the adjudicating proceedings, the Applicant has filed the consent application to
settle the above noncompliance on the payment of Rs. 6,92,750 towards settlement
charges. Theterm as proposed by the Applicant were placed before High Powered Advisory
Committee (HPAC) andHPAC recommended that the case may be settled on payment of
Rs. 6,92,750/-, accordingly SEBI settle the above non compliances and disposes of said
proceedings against the Applicant.
13
Consent order in the matter of M/s. Artech Power Products Limited
SEBI had initiated adjudication proceedings against M/s. Artech Power Products Limited
(hereinafter referred to as Applicant) and alleged that the applicant had delayed in
complying with Regulation 8(3) of SEBI (SAST), Regulations,1997 by 4892 days, 4527 days,
4161 days, 3796 days, 3431 days, 3066 days, 2700 days, 2335 days, 1970 days, 1605
days, 1239 days, 874 days, 509 days and 144 days during the year 1998 to 2011
respectively.
Pending the adjudicating proceedings, the Applicant has filed the consent application to
settle the above noncompliance on the payment of Rs. 7,09,750 towards settlement
charges. The term as proposed by the Applicant were placed before High Powered Advisory
Committee (HPAC) and HPAC recommended that the case may be settled on payment of
Rs. 7,09,750/-, accordingly SEBI settle the above non compliances and disposes of said
proceedings against the Applicant.
Consent order in the matter of M/s. Tak Machinery and Leasing
Limited (Now known as Mangal Credit and Fincorp Limited)
SEBI had initiated adjudication proceedings against Mr. Dasharath S. Mahadevia, Dasharath
S. Mahadevia (HUF), Mr. Aditya D. Mahadevia, Aditya D. Mahadevia (HUF), Mr. Tushar D.
Mahadevia, Tushar D. Mahadevia (HUF), Mrs. KasturiK. Mahadevia, Kashyap K. Mahadevia
(HUF), Mrs. Ranjana A Mahadevia and Mr. Viraj T. Mahadevia (hereinafter collectively
referred to as Applicants), erstwhile promotersof M/s Tak Machinery and Leasing Limited
(Target Company/TMLL) for the alleged violation of the provisions of Regulation 8(1) and
8(2) of the SEBI (SAST), 1997 as observed from the offer documents filed with SEBI by M/s.
E-Ally Consulting (India) Private Limited and Shree Jaisal Electronics & Industries along with
Mr. Sandeep Maloo, Mrs. Neeta Maloo, Mr. Labh Chand Maloo, Mrs. LataMaloo, Sandeep
Maloo (HUF) and Labh Chand Maloo (HUF)to acquire upto 1,40,810equity shares of face
value of Rs. 10/- each representing 20% of the share capital of TMLL.
Pending the adjudicating proceedings, the Applicants had filed the consent application for
the settlement of above violations and proposed to pay a sum of Rs 9,63,050 towards
settlement charges. The terms as proposed by the Applicants were placed before High
Powered Advisory Committee (HPAC) and on the recommendation of HPAC, SEBI settle the
above non compliances and disposes of said proceedings against the Applicants.
14
Adjudicating/WTM orders
Target Company Noticee Regulations Penalty
Imposed/
Decision
Taken
M/s.Turbotech
Engineering Limited
M/s. Shreeji Broking Private
Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Case disposed
off
M/s.Turbotech
Engineering Limited
M/s. Darshit Hydro Power
Project Private Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Rs. 3,00,000
M/s.Turbotech
Engineering Limited
M/s. Shah Space Manager
Private Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Rs. 3,00,000
M/s.Turbotech
Engineering Limited
M/s. Rudra Securities and
Capital Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Case disposed
off
M/s.Turbotech
Engineering Limited
M/s. Haresh Infrastructure
Private Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Case disposed
off
15
M/s.Turbotech
Engineering Limited
M/s. Trusha Mercantile
Private Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Case disposed
off
M/s.Turbotech
Engineering Limited
M/s. Corporate Commodity
Brokers Private Limited
Regulation 29(2) read with 29(3) of the
SEBI (SAST) Regulations, 2011 and
Regulation 13(3) read with Regulation
13(5) of SEBI (PIT) Regulations, 1992
Case disposed
off
M/s. Mapro Industries
Limited
M/s Mapro Industries
Limited, Mr. Gopal
KrishanSomani,
GopalKrishanSomani
(HUF), Mr. Sanjay Somani,
Sanjay Somani (HUF),
Ms. ShrutiSomani,
M/s. Alok Wires Private
Limited,
M/s. Mebags Investment
Services Private Limited.
Regulation 30(2) read with Regulation
30(3) of the SEBI (SAST) Regulations,
2011 and Regulation 8(3) of SEBI
(SAST) Regulations, 1997
Rs. 4,00,000 on
M/s. Mapro
Industries
Limited and Rs.
2,00,000 on
each of the
other Noticees.
M/s. Virtual Global
Education Limited
M/s. Virtual Global
Education Limited
Regulation 8(3) of SEBI (SAST)
Regulations, 1997
Rs. 12,00,000
M/s. Apte
Amalgamations Limited
Mr. VamanMadhavApte,
Mrs. Devaki LaxmanApte,
Mr. VikramVamanApte and
Mrs. Mithila VamanApte
Regulation 11(2) of SEBI (SAST)
Regulations, 1997 and Regulation 35 of
SEBI (SAST) Regulations,2011
Rs. 25,00,000
M/s. Apte
Amalgamations Limited
M. ApteKantilal Private
Limited
Regulation 10 and 12 of SEBI (SAST)
Regulations, 1997 read with Regulation
35 of SEBI (SAST) Regulations, 2011
Rs. 2,00,000
M/s. Apte
Amalgamations Limited
M/s. Apte Amalgamations
Limited
Regulation 8(3) of SEBI (SAST)
Regulations,1997 read with Regulation
35 of SEBI (SAST) Regulations, 2011
Rs. 7,00,000
M/s. Mahesh
Agricultural Implement
and Steel Forgings
Limited
Mr. Harish Gangaram
Agarwal and Late Mr.
Gangaram Agarwal
Regulation 30(2) read with 30(3) of
SEBI (SAST) Regulations,2011
Rs. 2,00,000
16
HINT OF THE MONTH
M/s. Glaxo Smithkline
Pharmaceuticals
Limited
M/s.Glaxo Group Limited Regulation 8(1),8(2) and Regulation
30(1) and 30(2) read with Regulation
30(3) of SEBI (SAST) Regulation, 1997
Rs. 25,00,000
M/s.AhlconParenterals
(India)
Limited
Mr.Bikramjit Ahluwalia, Ms.
Ram Piari, Ms. Pushpa
Rani and others
Regulation 11(2) read with Regulation
14(1) of
SEBI (SAST) Regulations, 1997
Rs. 20,00,000
M/s. Indo Pacific
Software &
Entertainment Limited
M/s.N Kumar Housing &
Infrastructure Limited
Regulation 7(1A) read with Regulation
7(2) of SEBI (SAST) Regulation, 1997
Rs. 3,00,000
M/s. Rajlaxmi Industries
Limited
M/s. Rajlaxmi Industries
Limited
Regulation 7(3) and 8(3) of SEBI
(SAST) Regulation, 1997
Rs. 4,50,000
M/s. Asian Oilfield
Services Limited
M/s. Samara Capital
Partners Fund I Limited
Regulation 30(1) and 30(2) read with
30(3) of SEBI (SAST) Regulation, 1997
Rs. 20,00,000
M/s. Sunrise Proteins
Limited
M/s. Sunrise Proteins
Limited
Regulation 8(3) of SEBI (SAST)
Regulations, 2011
Rs. 5,00,000
Acquirer is required to complete the payment of consideration to shareholders who have
accepted the offer within 10 working days from the date of closure of the open offer. If there is
a delay in payment of consideration (not due to non receipt of statutory approvals), it would be
treated as a violation of SEBI Takeover Regulations, 2011 and SEBI may issue direction to
such acquirer including direction to pay interest.
{As substantiated from FAQ of SEBI on SEBI Takeover Regulations, 2011}
17
Target Company
M/s. Skyweb Infotech
Limited
Registered Office
Delhi
Net worth of TC
Rs. 2.68 Cr.
(31.03.2014)
Listed At
DSE
Industry of TC
Telecommunication
Acquirer-
Mr. Neetesh Gupta
(Acquirer) along with Mr.
Ashok Gupta and Mrs.
Renu Gupta (PACs)
Target Company
M/s. Inland Printers
Limited
Registered Office
Mumbai
Net worth of TC
Rs. 13.98 Lacs
(31.03.2014)
Listed At BSE, DSE and ASE
Industry of TC
Commercial Printing/Stationery
Acquirer-
Mr. Kiran Kumar
Rameshbhai Patel and
Mr. BhaveshRamanlal
Patel
Details of the offer: Offer to acquire 19,21,600 equity
shares at a price of Rs. 5/- per fully paid up equity share
payable in cash.
Triggering Event: Share Purchase Agreement
(SPA) for the acquisition of 41,37,400 (55.98%) Equity
Shares of the Target Company.
Triggering Event: Preferential allotment of 3,00,000 Equity
Shares representing 30.00% of the expanded paid-up capital
of Target Company.
Details of the offer: Offer to acquire 2,60,000 Equity
Shares at a price of Rs. 38.50/- per fully paid up equity share
payable in cash.
Latest Open
Offers
18
Target Company
M/s. Neil Industries
Limited
Registered Office
Kolkata
Net worth of TC
49.82 Cr.
(31.03.2014)
Listed At CSE and UPSE
Industry of TC
NA
Acquirer-
Mr. Arvind Kumar Mittal
(Acquirer) and Arvind
Kumar Mittal (HUF),
Neeraj Kumar Mittal
(HUF), Mrs. Deepa
Mittal, Mrs. ReshuMittal
Details of the offer:Offer to acquire 39,10,640Equity
Share at a price of Rs. 31/- per fully paid up equity
share payable in cash.
Triggering Event:Memorandum of Understanding
(MOU) for the acquisition of management rights and control
over Target Company.
Triggering Event: Framework Agreement
for the acquisition of control over the Target Company
Details of the offer: Offer to acquire 73,69,958 equity
shares at a price of Rs. 100/- per fully paid up equity share
payable in cash.
Target Company
M/s. Fortune Financial
Services (India) Limited
Registered Office
Mumbai
Net worth of TC
10,213.71 Lacs
(31.03.2014)
Listed At
BSE
Industry of TC
Finance (Including NBFCs)
Acquirer
Neostar Developers LLP,
Aditya Infotech Private
Limited, and Mr. Chintan
Vijay Valia (Acquirers)
along with Mr. Sudhir V.
Valia, Ms. Raksha S. Valia,
Mr. Vijay M. Parekh and
Mr. Paresh M. Parekh
(PACs).
19
Target Company M/s Splash Media and
Infra Limited
Registered Office Mumbai
Net worth of TC
NA (30.06.2014)
ListedAt
BSE Limited
Industry of TC
Realty
Acquirers and PACs
Anil Agarwal (HUF)
Triggering Event: Share Purchase Agreement
(SPA) for the acquisition of 50,36,607 (5.37%) Equity Shares
and control over Target Company.
Details of the offer:Offer to acquire 2,43,67,200 Equity
Shares at a price of Rs 1.25/- per fully paid up equity share
payable in cash.
Target Company
M/s. PAN Electronics
(India) Limited
Registered Office
Bangalore
Net worth of TC
Rs. (892.90) lacs
(30.06.2014)
Listed At BSE and BgSE
Industry of TC
Electronic Components
Acquirer-
Mr.
GulluGellaramTalreja
Triggering Event:Share Purchase Agreement
(SPA) for the acquisition of 18,92,920 (47.32%) Equity Shares
and control over Target Company.
Details of the offer:Offer to acquire 10,40,000Equity
Share at a price of Rs. 7.88/- per fully paid up equity
share payable in cash.
20
Target Company M/s International
Pumps and Projects
Limited.
Registered Office
New Delhi
Net worth of TC
Rs. 211.54 Lacs
(30.06.2014)
ListedAt
DSE, ASE and JSE
Industry of TC
Industrial Machinery
Acquirers and PACs
Mr. Ankit Agarwal
Triggering Event: Share Purchase Agreement
(SPA) for the acquisition of 3,24,600 (4.10%) Equity Shares
and control over Target Company.
Details of the offer: Offer to acquire 20,58,030 Equity
Shares at a price of Rs. 10/- per fully paid up equity share
payable in cash.
Target Company
M/s. BCB Finance
Limited
Registered Office
Mumbai
Net worth of TC
Rs. 2077.82 lacs
(30.06.2014)
Listed At SME Exchange of BSE
Limited
Industry of TC
Finance (Including
NBFCs)
Acquirer-
M/s. Centrum Direct
Limited
Triggering Event: Share Purchase Agreement
(SPA) for the acquisition upto 60,00,000 (52.16%) Equity
Shares and control over the Target Company.
Details of the offer: Offer to acquire 29,92,000
Equity Share at a price of Rs. 25.25/- per fully paid up
equity share payable in cash.
21
Regular Section: Voluntary Open Offer
Voluntary Open Offer means Open Offer given by the acquirer voluntarily without
triggering the mandatory Open Offer obligations as envisaged under SEBI (SAST)
Regulations, 2011. Generally, the purpose of giving Voluntary Open Offer is to consolidate
the shareholding.
Regulation 6 of SEBI (SAST) Regulations, 2011 deals with the concept of Voluntary Open
Offer and provides the eligibility, conditions and restrictions with respect to the same that are
detailed below:
Eligibility for making Voluntary Open Offer
Acquirer along with PACs should be holding atleast 25% or more shares in the Target
Company prior to making voluntary Open Offer.
The Acquirer or PACs have not acquired any shares of the Target Company in the
preceding 52 weeks without attracting the Open Offer obligation.
Conditions for making Voluntary Open Offer
The aggregate shareholding after completion of the Voluntary Open Offer should not
exceed beyond the maximum permissible non-public shareholding.
Acquisition of Shares
without attracting
obligation to make PA
Voluntary Open
Offer Gap of 52 weeks
22
Note: Maximum permissible non-public shareholdingmeans such percentage
shareholding in the target company excluding the minimum public shareholding required
under the listing agreement
No acquisition during the offer period except under the Voluntary Open Offer.
Restrictions
The acquirer becomes ineligible to acquire further shares for a period of six months after the
completion of Open Offer except by way of:
Another Voluntary Open Offer;
Acquisitions by making a competing offer.
For Instance:
SwarajAutomotives Limited (Target Company)
Mahindra and Mahindra Limited (Acquirer) forms part of the promoter
group of the Target Company and holds 10,59,543 Equity Shares
constituting 44.19% of the Voting Share Capital of Target Company.
For the purpose of consolidation of shareholding, the Acquirer had
made the Voluntary Open Offer to acquire upto 27% of the voting
share capital of the Target Company. Pursuant to the Offer, the total
shareholding of the Acquirer increased to 71.19% of the Voting Share
Capital of the Target Company.
Existing no. of
shares
New shares acquired
undervoluntary offer
Maximum Permissible
non-public
shareholding
23
Acquisition of Information Systems Resource Centre Pvt. Ltd (ISCR) byLarsen and Toubro
Larsen and Toubro a major player of Engineering and infrastructure sector has acquired
pune based Information Systems Resource Centre Pvt. Ltd. (ISRC), a subsidiary of Otis
Elevator Co for an undisclosed amount. The acquisition was made through its subsidiary
L&T Infotech. The sale is line with the strategy to focus on its core operations and to
generate synergy benefits.
Acquisition of stake in Pramerica Mutual Fund by Dewan Housing Finance Dewan Housing Finance has acquired a 50% stake in Pramerica Asset Management for a
consideration of INR 244.92 Million. Pramerica Asset Management is the AMC of Pramerica
Mutual Fund and Pramerica Trustees. Post the acquisition of stake from Prudential Group,
Delaware the company would be converted into an equal JV and renamed as DHFL
Pramerica Asset Managers.
Future Lifestyle buys Majority stake in Elisir Lifestyle
Future Lifestyle Fashions Limited has acquired 60% stake in footwear firm Elisir Lifestyle Pvt
Ltd for an undisclosed amount. Elisir Lifestyle is engaged in business of manufacturing,
supply and distribution of footwear and accessories in India. Future Lifestyle was formed
after it was demerged from Future Consumer Enterprise Limited. The acquisition will lead to
diversification of business and overall synergy benefits.
Market Updates
24
Disclaimer:
This paper is a copyright of Corporate Professionals (India) Pvt. Ltd. The entire contents of this
paper have been developed on the basis of SEBI (Substantial Acquisition of Shares and
Takeovers) Regulations, 1997 and latest prevailing SEBI (Substantial Acquisition of Shares and
Takeovers) Regulations, 2011 in India. The author and the company expressly disclaim all and any
liability to any person who has read this paper, or otherwise, in respect of anything, and of
consequences of anything done, or omitted to be done by any such person in reliance upon the
contents of this paper.
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