SEBI (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021

Last updated: 08 December 2021

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The Securities and Exchange Board of India (SEBI) has introduced the Third Amendment to the Substantial Acquisition of Shares and Takeovers Regulations, 2021. This amendment introduces a new framework for 'Delisting Offers', allowing acquirers to seek the delisting of a target company as part of a public open offer. It also clarifies rules around retaining or delisting a company, specifies conditions for acquirers, and outlines procedures for both successful and unsuccessful delisting attempts. The amendment also makes consequential changes to existing regulations concerning open offers and shareholding thresholds.

SECURITIES AND EXCHANGE BOARD OF INDIA NOTIFICATION Mumbai, the 6th December, 2021 SECURITIES AND EXCHANGE BOARD OF INDIA (SUBSTANTIAL ACQUISITION OF SHARES AND TAKEOVERS) (THIRD AMENDMENT) REGULATIONS, 2021 No. SEBI/LAD-NRO/GN/2021/60. -In exercise of the powers conferred under section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the following regulations to further amend the Securities and Exchange Board of India (Substantial Acqu

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FAQ :

The main purpose is to introduce provisions for 'Delisting Offers', allowing acquirers to seek the delisting of a target company as part of an open offer, and to make other related amendments to the existing takeover regulations.

An acquirer can make a delisting offer if they declare their intention to delist the target company at the time of the public announcement and detailed public statement of the open offer. Certain conditions regarding the acquirer's previous association with the company and shareholding apply.

If a delisting offer is unsuccessful due to reasons such as non-receipt of shareholder or stock exchange approval, or not meeting the delisting threshold, the acquirer must make an announcement and comply with the regulations for completing the open offer.

Yes, an acquirer can state their intention to retain the listing upfront. In such cases, they may undertake a proportionate reduction of shares to be acquired to ensure their shareholding does not exceed the maximum permissible non-public shareholding.

The indicative price for a delisting offer must include a suitable premium, with full disclosure of the rationale and justification. It cannot be less than the book value of the company as per the Delisting Regulations.

These regulations come into force on the date of their publication in the Official Gazette.