The Securities and Exchange Board of India (Sebi) has given its go-ahead to four rights issues, totalling about R5,500 crore, proposed by TV18 Broadcast, Network18 Media & Investment, Bajaj Finserv and Bhushan Steel.
The rights issues of Network18 and TV18 would together raise about Rs.4,000 crore, while Bajaj Finserv and Bhushan Steel have offered to raise up to R1,000 crore and R474 crore, respectively.
In rights issue, shares are issued to existing investors as per their holding at pre-determined price and ratio. Out of these four issues, Bajaj Finserv had filed draft offer document with the Sebi last month itself, while the other three companies submitted their documents to the regulator earlier this year.
Sebi received the draft offer document for the Bhushan Steel rights issue through lead manager ICICI Securities on February 22 and issued its 'observations' on August 22. Issuance of the 'observations' on offer documents by Sebi is considered as a clearance to the issuer to go ahead with the share issues through routes like IPOs, FPOs and rights issue. Further, Sebi received draft offer documents for Bajaj Finserv rights issue on July 18 and issued its observations on August 17. JM Financial is the lead manager for this issue.
‘Higher holding in promoter firm won’t trigger open offer’
Market regulator Sebi has said that an open offer will not be required to be made for public shares of a listed company, merely due to its majority shareholder witnessing a higher holding by its own promoters. The position was clarified by Sebi in an 'informal guidance' sought by Arch Pharmalabs, the majority shareholder of Avon Organics with a 63.6% stake. While Arch Pharmalabs is an unlisted entity, Avon is listed on the BSE and a few other bourses. Sebi has communicated its position that an open offer would not be triggered for Avon, if the promoter group of Arch hikes its stake while continuing to remaining in control of Arch.