Takeover Panorama Nov-Dec_2014

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 Hon’ble 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 Hon’ble 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 Hon’ble Tribunal held that the

sale of shares in question were

reported on BSE’s 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

Hon’ble 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.


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

Hon’ble 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 non‐disclosure on part

of appellant.

Immediately on receipt of show‐cause 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 Hon’ble Tribunal

observed that the sale of shares in question were reported on BSE’s 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.


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 Hon’ble Tribunal held that the

sale of shares in question were

reported on BSE’s website in bulk

deal data and disclosures under

the Listing Agreement to BSE,

does not absolve the appellant

from making disclosures under


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 Hon’ble 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 non‐disclosure 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 show‐cause 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 Hon’ble Tribunal

observed that the sale of shares in question were reported on BSE’s 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 Hon’ble 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.


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 Hon’ble 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.


settlement of above violations and proposed to pay a sum of Rs 12,36,750 towards




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.


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.


settlement of above violations and proposed to pay a sum of Rs. 5,10,000 towards




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


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


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.



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


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.



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


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


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





Rs. 3,00,000

M/s.Turbotech

Engineering Limited

M/s. Shah Space Manager

Private Limited





Rs. 3,00,000

M/s.Turbotech

Engineering Limited

M/s. Rudra Securities and

Capital Limited





Case disposed

off

M/s.Turbotech

Engineering Limited

M/s. Haresh Infrastructure

Private Limited





Case disposed

off

15

M/s.Turbotech

Engineering Limited

M/s. Trusha Mercantile

Private Limited





Case disposed

off

M/s.Turbotech

Engineering Limited

M/s. Corporate Commodity

Brokers Private Limited





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.


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


Regulations, 1997 and Regulation 35 of

SEBI (SAST) Regulations,2011

Rs. 25,00,000

M/s. Apte


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


M/s. Apte Amalgamations

Limited


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


14(1) of


Rs. 20,00,000

M/s. Indo Pacific

Software &

Entertainment Limited

M/s.N Kumar Housing &

Infrastructure Limited

Regulation 7(1A) read with Regulation


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


Rs. 20,00,000

M/s. Sunrise Proteins

Limited

M/s. Sunrise Proteins

Limited


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)


(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



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




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


(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.

Visit us at

D- 28, South Extn. Part I New Delhi – 110049

T: 40622200 F: 91.40622201

E: [email protected]

A venture of

Our TEAM

OUR GAMUT OF SERVICES:-

Investment Banking;

Valuation & Business Modelling;

Merger & Acquisition;

Tax & Transaction Advisory;

ESOP/ESPS;

Domestic & Cross Border Investment

Structuring;

Group Reorganisation;

Corporate Funding;

Issue Management.

Manoj Kumar


D: +91.11.40622228

Divya Vijay


D: +91.11.40622248

mailto:[email protected]



Takeover Panorama Nov-Dec_2014

Economy & Finance

Transcript of Takeover Panorama Nov-Dec_2014