In its board meeting on 29 September 2020 SEBI took several important decisions. Among others, it decided that a listed entity must disclose the initiation of a forensic audit ; the delisting of a listed subsidiary would be exempted from the Reverse Book Building process, where it becomes the wholly owned subsidiary of the listed parent pursuant to a scheme of arrangement. It also decided to strengthened the role of a debenture trustee, and to amend the AIF, PIT and Mutual Fund Regulations as under :
The issuer company in turn will create a recovery expense fund at the time of issuance of debt securities for utilisation by DTs in the event of default, for taking appropriate legal action to enforce the security. Corresponding amendments to the Debenture Trustees Regulations 1993, Issue and Listing of Debt Securities Regulations, 2008 and Listing Obligations and Disclosure Requirements Regulations, 2015 will be made to give effect to these decisions.
The votes cast by public shareholders of the listed subsidiary in favour of the proposal should be atleast 2 times the number of votes cast against it in terms of the present delisting regulations.
To refer to the SEBI press release dated 29 September 2020, click here.
This is intended for general information purposes only. The views and opinions expressed in this article are those of the author/authors and does not necessarily reflect the views of the firm.
The Bar Council of India does not permit solicitation of work and advertising by legal practitioners and advocates. By accessing the Shardul Amarchand Mangaldas & Co. website (our website), the user acknowledges that: