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| New takeover code to give level playing field: Achutan |
| Press Trust of India / New Delhi Sep 07, 2010, 18:19 IST |
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The proposed takeover code will provide a level playing field to all stakeholders, whether they are promoters or small investors, said Sebi takeover panel chairman C Achutan today.
"The takeover code aims at providing a fair, equitable, transparent and legal framework. It is to give everybody a level playing field," Achutan told reporters on the sidelines of a CII event here.
The recommendations made by the Takeover Regulatory Advisory Committee include raising the public offer trigger to 25 per cent, from the existing 15 per cent. Besides, the panel has also suggested the acquirer should make an open offer for the entire 100 per cent stake in case his holding cross the 25 per cent threshold.
"Everybody should be treated at par... It should not only be an exit opportunity for majority shareholders, but minority shareholders as well," he said.
The suggestions, if implemented, will replace the archaic takeover rule that was amended 23 times in the past 13 years. Achutan, who was appointed the head of the panel in September 2009, submitted the report to Securities and Exchange Board of India Chairman CB Bhave on July 19.
The Sebi said it will take a decision on implementing the suggestions after it takes into account the public comments received till August end.
"We have received 600 public comments till August 31 with some agreeing to the suggestion and some disagreeing. The Sebi board will take a decision on its implementation after analysing the suggestions," Sebi general manager Neelam Bharadwaj said.
Funding needs of companies for acquisition are se to soar as buyers will have to make open offer for the entire 100 per cent stake and make arrangements for financing at the time of the announcement of the deal.
On whether the cost of acquisition would go up, Achutan said, "it is business.. Without money you cannot make business."
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