The board of Securities and Exchange Board of India (Sebi) is set to meet on December 16 to discuss some crucial issues pertaining to capital and commodity markets. The key issues on the agenda include relaxation in minimum promoter contribution in Follow on Public Offer and new shareholding norms for Corporate Insolvency Resolution Process companies.
Moneycontrol was the first to report about this meeting on December 8.
Here are the issues to be discussed at the Sebi board meeting:
Sebi on FPO
The regulator may give relaxation to promoters in Follow on Public Offer (FPO) requirement of 20 percent Minimum Promoter Contribution (MPC). Sebi has a plan to give relaxation to promoters for participating in Follow on Public Offer. The relaxation should be available for those companies which are listed on exchanges for more than three years. However, these firms should not have major complaints pending against them.
Regulations for CIRP companies
The regulator may also discuss new shareholding norms for companies under the purview of the Corporate Insolvency Resolution Process (CIRP) as well as amendments in Listing Obligations and Disclosure Requirements (LODR).
Sebi has issued a discussion paper for shareholding norms for CIRP companies.
It may discuss three proposed options. In the first option, the regulator proposed that after exiting CIRP, companies need to achieve at least 10 percent public shareholding within six months and 25 percent within 3 years from the date of breach of the minimum public shareholding requirement. Similarly in the second option, post-CIRP companies have at least 5 percent public shareholding and in the third option 10 percent public shareholding at the time of re-listing.
Amendment in LODR
Sebi may also discuss amendments to the Listing Obligations and Disclosure Requirements (LODR). The regulator may discuss having listed companies disclose their financial results to exchanges within 30 minutes of board approval. Currently, such disclosures have to be made when the meeting is completed.
The regulator may ask the top 1,000 listed companies to formulate a dividend distribution policy applicable to the top 500 companies as per market capitalisation.
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