A R DAHIYA AND ASSOCIATES Vs. STATE
SECURITIES APPELLATE TRIBUNAL
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(1.) SHRI A.R. Dahiya & Associates (hereinafter referred to as 'the Acquirer') entered into a Memorandum of Understanding (MOU) with V P Garg and Associates (hereinafter referred to as "the erstwhile promoters") on April 20, 1999 to acquire 9, 54, 450 shares representing 28.09% shares of the equity capital of Polo Hotels Ltd. (hereinafter referred to as 'the Target company') @ Rs.8.50 per share. The shares of the Target company are listed at The Stock Exchange, Mumbai, Delhi Stock Exchange and Ludhiana Stock Exchange.
(2.) On April 24, 1999 the Acquirer made a public announcement to acquire 20% shares @ Rs.8.75 per share of the Target company pursuant to the MOU dated April 20, 1999 with the erstwhile co-promoters of the Target company in terms of Regulation 10 of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as "the Regulations").
On May 05, 1999 the Acquirer submitted the draft letter of offer to Securities and Exchange Board of India (hereinafter referred to as "SEBI") through its Merchant Banker , Master Capital Services Limited (hereinafter referred to as "MCSIL") . In the draft offer document the Acquirer, inter alia, made the disclosure about the financial collaboration agreement entered into between the Acquirer, erstwhile promoter and the Haryana State Industrial Development Corporation (HSIDC) on April 19, 1999 and the details of how the price will be determined at the time of buy-back of shares from HSIDC by the Acquirer. It was also mentioned that the transfer of shares from HSIDC to the Acquirer would be inter-se promoter transfer and hence exempted from an obligation of making Public Offer in terms of the Regulations.
(3.) SEBI finally cleared the documents vide its letter dated September 30, 1999 advising the Acquirer, inter alia, that the mention of exemption from the Regulations, of transfer of shares from HSIDC to the Acquirer be deleted and it be disclosed in the Letter of offer that the acquisition of shares under the Financial Collaboration Agreement will be governed by the provisions of Regulations in force at that point of time when the acquisition actually takes place.;
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