Shareholding norms deadline to stay: SEBI
The Security and Exchange Board of India (SEBI) has indicated that listed firms will be required to comply with the minimum public shareholding norms by August 2013.business Updated: Aug 05, 2012 23:07 IST
The Security and Exchange Board of India (SEBI) has indicated that listed firms will be required to comply with the minimum public shareholding norms by August 2013.
In 2010, SEBI had come out with norms that government firms should have a minimum public shareholding of 10% while for private companies it is 25%. These guidelines were to be met within three years. There were some objections raised, claiming that offloading the shares in the current scenario when the capital markets are choppy could be tricky, and lead to a major share price correction in these firms.
Some private companies have been requesting SEBI to postpone the deadline for public shareholding norms.
“It is a completely wrong assumption that the three-year time frame given is too short,” SEBI chairman U K Sinha said. He also pointed out that the time frame has “already crossed 11 years, definitely 6 years.”
The public companies listed on the Indian platforms will be required to offload shares worth around R32,000 crore. Accor-ding to an estimate, the share of public companies in the total shares offloaded will be around R11,000 crore. SEBI also has provisions for companies that violate the shareholding norms.