Wednesday, 4 September 2013

Securities and Exchange Board of India amends Preferential Issue rules for listed companies

Chapter VII of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 (‘Preferential Issue Regulation’) deals with issue of securities on preferential basis by companies listed on the Indian stock exchanges.


Vide Notification dated 26th August, 2013 (‘Notification’) SEBI has made certain amendments to the said Chapter. This Alert summarises the key amendments introduced through the Notification.


Listed companies in India have long made use of the preferential allotment route to garner funds on private placement basis.


Vide the Notification, it appears that the capital market watchdog, SEBI has sought to bring about more transparency, accountability and audit trail to the process of preferential issues

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