SEBI gives six more months to Prabhat Dairy for delisting shares

Image: Wikimedia Commons/Jimmy vikas

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Markets regulator Sebi on December 21 granted a six-month extension to Prabhat Dairy Ltd (PDL) to complete the delisting process. The company received shareholders' nod for delisting the company on October 14, 2019.

In October this year, PDL requested Sebi for six-month extension for filing the final application for delisting, citing the nationwide lockdown that was imposed in March as a reason.

Under the Sebi norms, a company is required to make the final application to stock exchanges for delisting within one year of passing the special resolution. In a six-page order, the watchdog gave an extension of six months to the special resolution passed by the shareholders for the delisting of the company till April 13, 2021, subject to certain conditions.

The regulator had asked for a forensic audit of the company for 2018-19 and 2019-20. However, due to the lockdown, the statutory audit process also got delayed, in turn, delaying the forensic audit process. PDL declared its audited financial results for the year 2019-20 on October 8.

Seeking extension, the company also said it aims to complete the forensic audit at the earliest and the delisting of equity shares is in the interest of all public shareholders. The extension is subject to the conditions, including that the company should extend full cooperation and provide all the requisite information and documents to the forensic auditor within 10 working days from the date of this order. It has to be done on a timely basis to ensure expeditious completion of the forensic audit at the earliest.

"Completion of forensic audit (primarily delayed by not providing the requisite information and documents to the forensic auditor) and the outcome of the same appears to have an impact on the interest of the public shareholders. "Since, the process of forensic audit is in progress and incomplete, it would be in the interest of the minority public shareholders of the PDL that forensic audit is completed before the stock exchanges consider the final application for delisting," it said.