Sebi lays out new delisting norms
Mumbai: Stock market regulator Sebi has laid out new delisting norms as it seeks to scrap the book building process for de-listing of shares from the stock exchanges putting in place an alternative pricing mechanism.

Under this, the offer price shall be higher than the fixed price, which would be the floor price plus a premium of 25 per cent. The floor price would be determined by Regulation 20 of SEBI (Substantial Acquisition of Shares and Takeover). Regulation 20 sets down the norms for the determination of the minimum offer price (in this case floor price). Under the second option, the offer price will have to be over the fair value determined by an accredited rating agency plus a premium of 25 per cent.

The reference date for calculating the floor prices would be the date on which the stock exchanges are notified of the Board meeting in which the de-listing proposal was considered.
Back to News Review index page  

Cairn raises Rs3,700-cr in pre-IPO floatation
New Delhi: Cairn Energy Plc has raised Rs3,700 crore from pre-IPO private placement of Cairn India shares with the largest investor in the placement being a wholly owned subsidiary of Petronas, Malaysia.

Sources said the pre-flotation private placement closed on November 22 and 209.67 million Cairn India shares were placed at a price of Rs 176.48 per share, raising a total of Rs3,700 crore.

The placement at the said price implies that Cairn Energy's Indian business is valued at $6.92 billion (Rs 31,154 crore).

The largest investor in the placing is Petronas, which subscribed to 176.53 million shares, representing 10 per cent of the post-floatation share capital, the company said in a statement. A combination of Indian and international institutional investors, including Videocon are subscribing to the balance of 33.14 million shares. After this placement, the net offer of shares to the public in Cairn India falls from 538.47 million to 328.80 million shares.
Back to News Review index page  

IPOs of three power PSUs get approval from CCEA
New Delhi: The Cabinet Committee on Economic Affairs has approved the initial public offerings of three State-owned power companies - Power Finance Corporation, Power Grid Corporation and Rural Electrification Corporation - through fresh issue of shares.

The Finance Minister, P. Chidambaram said he all the three IPOs would enter the market in the last quarter of fiscal 2006-07. The IPO proceeds are to be used by the respective companies for their expansion plans.

PFC would issue 11, 73, 16,700 shares equivalent to 10.22 per cent of the post-issue capital of the company.

PGCIL would issue shares in tranches that would not exceed 24 per cent of the paid-up capital of the company. The first tranche would be 10 per cent, Chidambaram said.

REC would issue 15.6 crore shares, which is about 20 per cent of equity capital.
Back to News Review index page  

Bharat Earth Movers plans public issue
Kolkata: Bharat Earth Movers (BEML), a mini Navratna-status company plans to enter the capital market with a public issue by March 2007 targeting to raise Rs400 crore (including the premium). The issue size will be 49,00,000 equity shares with a face value of Rs10 per share. Issue price of the shares would be fixed based on the current market price of the company's shares in the stock exchanges. The Union Government, which holds 61.2 per cent of the company's total paid-up capital of Rs38 crore, would not subscribe any shares from the issue.

The result would be that the Government's holding in BEML in percentage terms, would come down to 56 per cent leaving the balance shares to FIIs, FIs, commercial banks and public.
Back to News Review index page  

Firstsource files for IPO
Mumbai: ICICI OneSource has filed its red herring prospectus with SEBI for selling 9.56 crore equity shares through an initial public offering. This constitutes 23 per cent of the post issue share capital of the company. The company has also been renamed as `Firstsource'.

Out of the proceeds of the IPO, the company plans to spend Rs 180 crore on acquisitions and Rs 45 crore on debt repayment. The funds will be utilised by March 31, 2008.

The ICICI group will continue to be a significant investor in Firstsource with board representation, said Kalpana Morparia, joint MD of ICICI Bank.

The 9.56-crore equity share issue includes fresh issue of six crore equity shares and 3.56 crore offered for sale by the ICICI group. The ICICI Bank Group holds about 50 per cent in the company and post IPO, the stake will come down to 34.2 per cent.

Metavante Corp, Aranda Investments (Mauritius) Pte Ltd, an affiliate of Singapore-based Temasek Holdings, and Westbridge Capital Partners, which is now managed by Sequoia Capital India, are the other stakeholders in the company.

Firstsource has filed its registration statement and prospectus with SEBI, though it hasn't disclosed the amount it plans to raise through the IPO.
Back to News Review index page  

Oriental Bank to offer online share trading in tie-up with IL&FS Investsmart
New Delhi: Oriental Bank of Commerce (OBC) is launching online share trading facility to its demat account holders and has signed a memorandum of understanding with IL&FS Investsmart for this.

Initially, the online share trading facility would be available at Mumbai and would get extended in due course to other branches. Currently, OBC has more than 1 lakh demat accounts spread over 111 branches.

The MoU also provides for the bank's customers to undertake share trading at designated branches.

OBC officials said the MoU would help the bank in expanding its customer base for savings and current accounts. Till date, OBC customers were able to opt for only bank and demat accounts. They could not undertake online trading of shares.
Back to News Review index page  

HDFC Bank allowed to open DP a/cs
Mumbai: The Security and Exchange Board of India has allowed HDFC Bank, a depository participant, to open fresh demat accounts. SEBI had prohibited the bank to issue further demat accounts, as it had failed to adhere to the `know your client' norms.

Sebi's had found that HDFC Bank had facilitated opening of demat accounts in fictitious-benami names to corner the retail portion of shares in Initial Public Offerings. In its order, SEBI has said that all issues and contentions will be left open to be considered by the Enquiry Officer appointed by it and will be decided in subsequent proceedings.
Back to News Review index page  

SEBI to announce qualification norms for MF distributors
Mumbai: SEBI plans to prescribe qualification norms for distributors of mutual funds that would place the mutual fund industry on par with global markets. Industry analysts say fund management is an extremely complex, skilful and disciplined profession and from the investor- interest point of view it has to be handled by people who are appropriately qualified.
Back to News Review index page  

LIC Mutual introduces India Vision fund
Mumbai: LIC Mutual Fund has launched LIC MF India Vision Fund, a three-year close-ended equity scheme aiming to generate long-term appreciation by investing in companies in growth sectors. The scheme will turn into an open-ended scheme at the end of the 3-year term.

The fund can invest 100 per cent of the corpus in equity if it does not invest in debt and other instruments. Otherwise, it can invest up to 20 per cent in debt and up to 10 per cent in DRs/GDRs/foreign securities with 70 per cent being in equity.

The new fund offer opens on November 23 and closes on December 22. The minimum investment for the fund is Rs2,000. Back to News Review index page  

FIIs' investment in Yes Bank
Mumbai: FIIs, NRIs and persons of Indian origin can now purchase equity shares and convertible debentures of Yes Bank under the portfolio investment scheme up to 49 per cent of its paid-up capital, according to an RBI circular.
Back to News Review index page