Sebi relaxes rules for promoters looking to change status
The market regulator proposes to change the minimum threshold for voting rights for the re-classification of a promoter as a public shareholder and suggested that all promoter entities disclose their shareholding even in the case of “nil” holding.
Under the proposal, Sebi said the re-classification condition on shareholding should be amended such that the promoter and related persons seeking re-classification should not together hold 15 per cent or more of the total voting rights in the listed entity.
At present, the minimum threshold requirement is 10 per cent.
The regulator received a feedback from market participants to review the current threshold of 10 per cent so that the persons who may have been promoters but are no longer in day-to-day control, having shareholding of less than 15 per cent, may “opt-out” from being classified as promoters without having to reduce their shareholding.
Relaxation from existing requirement on a case-to-case basis has been given by Sebi and the existing provisions should be revisitied to minimise the number of exemptions provided on a case-to-case basis, the regulator said in a consultation paper.
“The exemption from... Listing Obligations and Disclosure Requirements (LODR), as extended in the case of re-classification of promoter may also be extended to re-classification pursuant to an order/direction of the government / regulator and/or as a consequence of operation of law,” Sebi said.