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private placement versus preferential offer

YB RAJU GG (7 Points)

21 March 2019

what is the main difference between private placement and preferential offer on issue and process point of view ?

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Chirag (Professional) (1979 Points)
Replied 23 March 2019

Logically, Private placement ( Which is not public offer) but securities offered to "Identified" person other than existing holders with Max. capping of 200 for each offer in a financial Year, With compliance of Section 42 & Relevant Regulations.

Preferential Allotment ( Preference over other) When Selected group of existing shareholder or convertible securities are offered securities with compliance of section 62(1)(c) ,SEBI Regulations ( For Listed Entity) ,and relevant regulations...

For more information and side by side comparison make chart of Section 42 & Section 62(1)(c) And rule 13 & 14 of Companies (PAS) Rules with recent amendments -- You can find it on mca websites or through google... Keeping in mind the basic things which I described it will be cleared..