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Substantial Acquisition of Shares

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M&A, Sebi Takeover Code, Substantial Acquisition of Shares
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  Substantial Acquisition of Shares  Acquisition of 15% or more of shares ã No acquirer can acquire 15% or more of voting rights in company, unless such acquirer makes a public announcement.  Acquisition by person having more than 15% but less than 55% ã Acquirer is allowed to purchase additional shares or voting rights of up to 5% per financial year without making a public announcement of an open offer.   Acquisition by person having more than 55% but less than 75% ã Acquirers holding from 55% to 75% shares were required to make such public announcement for any additional purchase of shares  Procedure Involved in Takeover ã  Appointment of Merchant Bank The acquirer need to appoint a Category 1 merchant banker ã Public Announcement of Offer The announcement of offer is made by merchant bank by publishing it in newspaper. Public announcement must contain the offer price, number of shares to be acquired from the public, identify of acquires purpose, future plans in respect of target company, period with in which offer would be completed.  ã Submission of Letter of Offer to SEBI Within 14 days of public announcement, acquirer must file draft letter of offer along with filling fees of 50,000/-. ã Offer Price While determining minimum offer price, the acquirer in consultation with merchant bankers to take into consideration various parameters. ã Dispatch of Letter of Credit to Shareholders
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