Hi, which allotment option is to be selected in FORM PAS-3 if allotment done to existing shareholders but not proportionately to their existing ratio .
i am confused if i should chose rights issue or private placement option.
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Which allotment option to select in PAS-3 if allotment to existing shareholders
Replies (1)
Hey Rushi! Here’s a clear answer for your PAS-3 allotment option question:
Scenario:
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Shares are allotted to existing shareholders
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But not proportionate to their existing shareholding
What option to select in PAS-3?
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Since the allotment is not proportionate to their existing shareholding, it cannot be treated as a "Rights Issue".
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Rights Issue means offering shares to existing shareholders in proportion to their existing holdings.
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Here, since it's disproportionate, this is treated as a Private Placement.
So, in FORM PAS-3:
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Select the "Private Placement" option under allotment type.
Why?
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Private Placement covers allotments made to existing shareholders or others, without adhering to proportional rights.
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Rights Issue is only when shares are offered strictly proportionate to existing holdings.
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