Creation of security

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CA Sriram (Querist)
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01 November 2008 Dear All
My bank is providing finance to a indian company for investing in equity of a company located in saudi arabi. Is there any way through which shares of the saudi company can be pledged or can i create any charge on the assets of the saudi company in favour of the bank.
In other ways how can i get a secuirty of the saudi company to the extent of my loan

Presently i have taken the corporate guarantee of the borrower company and extension of charge on the assets of the borrower.

Regards

Sriram Peri

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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01 November 2008 Is it extension of charge on the future movable and immovable assets of the borrower company.

CA Sriram

CA Sriram (Querist)
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01 November 2008 Ya extension of charge on future moveable and immoveable assets of the borrower with that of existing loans

CA Sriram

CA Sriram (Querist)
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01 November 2008 A

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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03 November 2008 If the banks are willing to accept the shares as security, I see no problem, as they, being authorised dealers, will advice and do the needful under the FEMA.

CA Sriram

CA Sriram (Querist)
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03 November 2008 Hi Srinivasraghavan.
My question is "any way of pledging the equity of the company located in the saudi arabia in the favour of bank located in India" I have been told that there is no system of pledging of shares of the companies located in saudi.

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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03 November 2008 If the shares of Saudi company is not to be pledged due to any special law of that country your question does not serve any purpose is it not?

CA Sriram

CA Sriram (Querist)
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04 November 2008 Mr Srinivasraghavan

Regarding the pledging of shares, i came to know through open discusion . So i wanted to confirm from an expert regarding the same.
It seems u still not able to get the gist of the problem,once again i will repeat for u
"How to secure the loan given to "A" P Ltd for investing in the equity of a company in saudi" ie measures available for securing the loan
1)To say Corporate guarantee of borrower.
2) Extension charge on the assets of the borrower
I am interested in knowing more solutions available for securing the loan

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