Preference shares

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Querist : Anonymous

Querist : Anonymous (Querist)

10 January 2011 I have some questions regarding preference share issue.

1)what is public issue whether it includes issue of preference shares?

2) If a limited company wants to raise preference shares will it follow Sebi guidelines.if yes, that are they?

3) Will it issue statement in lieu of prospectus?

udit sharma

udit sharma (Expert)
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10 January 2011 Hi...

1. Public Issue means an offer made to the public at large for subscribing the shares of the company. This offer is made by way of a prospectus.

2. A Listed Company limited by shares will have to follow the guidelines issued by SEBI. SEBI Guidelines will not be applicable to an unlisted Indian Company,

3. Since, the Company is making a public issue of shares through propsectus, no need to file statement in lieu of prospectus.

Regards

CS Udit Sharma

Jayashree S Iyer

Jayashree S Iyer (Expert)
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10 January 2011 Answers to your queries:
1) Public Issue includes issue of Preference shares as well.
2) A listed public company should follow SEBI guidelines and issue Prospectus at the time of Public Issue. However unlisted public companies can issue preference shares by way of private placements in which case they will be required to issue only statement in lieu of Prospectus.
3) Unlisted Public Companies will issue statement in lieu of prospectus at the time of raising capital by private placements.

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