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Friday, July 10, 2009

One day Anchor investors for 30 day lock in, include convertible instruments period for offer for sale & listing in stock exchanges with nation wide terminals - SEBI DIP amended


Compulsory listing of IPO on at least one stock exchange with nationwide trading terminals

It has been decided to amend clause 2.1.4 of the SEBI (DIP) Guidelines to provide that an unlisted company making an IPO shall list the securities being issued through the IPO on at least one stock exchange having nationwide trading terminals.

Convertible Equity shares considered eligible for offer for sale

A shareholder can make an offer for sale of the equity shares if such equity shares have been held for a period of at least one year as on the date of filing the draft offer document with SEBI.  It has been decided to amend clause 4.14.2 of the SEBI (DIP) Guidelines to provide that in case equity shares which are received on conversion of fully paid compulsorily convertible securities, including depository receipts, are being offered for sale, the holding period of such convertible securities as well as that of resultant equity shares together shall be considered for the purpose of calculation of the eligibility period.

Introduction of concept of Anchor Investor in public issues through book building route

In clause 11.3.5 after sub-clause (iia), the following sub clause (iib) shall be inserted :-

Out of the portion available for allocation to Qualified Institutional Buyers (QIB) under sub-clause (i) or (ii) or any proviso thereof, as the case may be, UPTO 30% may be allocated to Anchor Investors subject to the following:
a) Anchor Investors shall necessarily be Qualified Institutional Buyers (QIB) as defined in these guidelines.
b) The minimum application size by an Anchor Investor shall be Rs.10 crores.
c) One-third (1/3rd) of the Anchor Investor portion shall be reserved for domestic mutual funds (MF).
d) The bidding for Anchor Investors shall open one day before the issue opens and shall be completed on the SAME day.
e) Allocation to Anchor Investors shall be on a discretionary basis subject to minimum number of 2 investors for allocation of upto Rs.250 crores and 5 investors for allocation of more than Rs.250 crores.
f) The number of shares allocated to Anchor Investors and the price at which the allocation is made, shall be made available in public domain by the merchant banker before opening of the issue.
g) Anchor Investors shall pay a margin of at least 25% on application with the balance to be paid within 2 days of the date of closure of the issue.

h) If the price fixed for the public issue through book building process is higher than the price at which the allocation is made to Anchor Investors, the additional amount shall be paid by the Anchor Investors. However, if the price fixed for public issue is lower than the price at which the allocation is made to Anchor Investors, difference shall not be payable to the Anchor Investors.
i) There shall be a lock-in of 30 days on the shares allotted to the Anchor Investors from the date of allotment in the public issue.
j) No person related to the book running lead managers/ promoters/promoter group in the concerned public issue or the book running lead managers to the concerned public issue can apply under Anchor Investor category.
k) The parameters for selection of Anchor Investors shall be clearly identified by the merchant banker and shall be available as part of records of the merchant banker for inspection by SEBI.
l) The applications made by Qualified Institutional Buyers under Anchor Investor category and under Non Anchor Investor category may not be considered as multiple applications.

Click here for the Applicability of the Guidelines

Download the amended SEBI DIP Guidelines, 2000 as on date


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