SC refuses stay on Linde India valuation probe after SAT dismisses plea, stock jumps on potential gains

The Securities Appellate Tribunal (SAT) recently dismissed Linde India plea on valuation relief.

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Linde India share price jumped over 7 percent on September 23, after the Supreme Court reportedly refused a stay on the SEBI-directed valuation exercise for the Indian unit of a global industrial gases and engineering giant. At the time of publishing, Linde India stock was trading at Rs 8,508.65 on the NSE, up 4.15 percent.

Linde India approached the Supreme Court, according to media reports, challenging a Securities Appellate Tribunal (SAT) decision, which rejected the company’s appeal against a valuation exercise. The appeal pertains to Linde’s related-party transactions, a review of which has been ordered by markets regulator SEBI.

The Supreme Court noted on Monday that the Securities Appellate Tribunal (SAT) has already disposed of the appeal, reported NDTV Profit. SAT is expected to take up the matter on October 15.

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The case involves multiple transactions and agreements that Linde India entered into with Praxair India and Linde South Asia Services, both of which are related parties of the company.

In July, capital-markets regulator SEBI exchanged harsh words following the examination of the company's related-party transactions (RPTs) with Praxair India Pvt Ltd (PIPL) and Linde South Asia Services Pvt Ltd (LSASPL).

After Linde India submitted that the capital-markets regulator had made "bald innuendos" in its interim order, the regulator issued a final order stating that the company's counter could "at its charitable best, be termed as dishonest and misleading." The interim order was issued on April 29 and the final order on July 24.

In the final order, SEBI has asked NSE to appoint a valuer to assess the business lost to the related-party transactions. The transactions were entered into through a joint venture and shareholders' agreement signed between Linde India and PIPL. Shareholders may expect that money to flow back into the company.

The regulator started investigating the RPTs after receiving complaints from Linde India's shareholders that the transactions were entered into without obtaining their approval and were not in the best interests of Linde India.

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