Supreme Court clears way for Reliance Power IPO, stays proceedings against public offer
09 Jan 2008
Mumbai: The Supreme Court has granted an interim stay of the proceedings in the Gujarat High Court against the public offer of Reliance Power, clearing the last legal hurdle for the initial public offer of the company.
A bench headed by Chief Justice K G Balakrishnan restrained the Gujarat High Court from hearing two public interest lawsuits (PILs), allegedly filed to stall the January 15 launch of the country's biggest initial public offering (IPO) by the Anil Ambani-promoted Reliance Power Ltd (RPL).
The Supreme Court also issued notices to the Gujarat-based organisations - Jagrut Grahak Suraksha Mahila Mandal and Rajkot Saher Grahak Suraksha Mandal - that has challenged the IPO.
The organisations had moved the Bombay High Court against Reliance Power and Reliance Energy accusing the company of violating the Securities and Exchange Board of India (SEBI) regulations and the HC had sent the case to the market regulator last November. Sebi had rejected the petitions. The appeal against it is pending in the Securities Appellate Tribunal.
Meanwhile, the petitioner moved the Gujarat High Court where the case was about to be heard.
Reliance Power questioned the bona fides of the public interest petitions moved by Jagrut Grahak Suraksha Mahila Mandal and Rajkot Saher Grahak Suraksha Mandal.
Arguing for the company, senior counsel Harish Salve stated that one person who has rushed to buy 51 shares in Reliance Energy was behind this harassment of the company. "PIL has now become surrogate corporate war," the counsel said.
With the SC stay, the High Court would not hear the PILs, and the public issue will go forward without further legal hindrance.
