CNBC-TV18’s Sajeet Mangat reports that SEBI has allowed Wipro to meet the 25-percent minimum public float by transfering promoter equity to its philanthropic trust.
Market regulator SEBI has given special permission to Wipro in meeting the 25-percent minimum public float. The IT giant can transfer promoter equity to a philanthropic trust with trustees either from public sector banks or public financial institutions, reports CNBC-TV18's Sajeet Mangat.
After a lot of back-and-forth between SEBI and Azim Premji, Wipro finally received approval to transfer stake to an independent trust. The trust would have nominees from banks and financial institutions and these trustees will ensure that the divestment of stake will happen within two years from the completion of the demerger underway at the company.
Wipro needs to divest a stake of around 4.7 percent but this would come down once the entire demerger is complete and shareholders opt for additional Wipro shares as part of the demerger process.
However, experts point out that the SEBI’s decision has opened a Pandora's Box and promoters will set up independent trusts and escape the entire divestment June-deadline.
The details of the deficit will be known by May 15 when the entire demerger process is completed. But market regulator is going to get a lot of applications for such a move, going forward.
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