New Delhi, May 5 (PTI) Capital markets regulator Sebi on Tuesday granted the promoter family trusts of Muthoot Microfin Ltd an exemption from making an open offer in connection with a proposed internal restructuring involving the indirect acquisition of shares.
Six promoter family trusts, Thomas John Muthoot (MF) Trust, Thomas George Muthoot (MF) Trust, Thomas Muthoot (MF) Trust, Preethi John Muthoot (MF) Trust, Nina George (MF) Trust and Remmy Thomas (MF) Trust, have been exempted from open offer obligations under the Takeover rules for acquiring indirect control in the company.
"I, hereby grant exemption to the proposed acquirers, from complying with the SAST Regulations, 2011, with respect to the proposed direct acquisition in the target company, viz., Muthoot Microfin Ltd, by way of the proposed transaction," Sebi's Whole Time Member Kamlesh Chandra Varshney said in the order.
The exemption pertains to the proposed transaction, which involves an indirect acquisition of a 50.21 per cent stake in Muthoot Microfin (target company) held by Muthoot Fincorp Ltd (MFL), through the acquisition of 99.56 per cent shareholding andcontrol in MFL.
The transaction is part of an internal reorganisation within the promoter family, aimed at streamlining the succession and welfare of the members of the Muthoot Family.
It involves the transfer of shares among promoters, including the gifting of shares to spouses, followed by the transfer of respective family trusts.
Sebi noted that the proposed acquisition will not result in any change in control or management of Muthoot Microfin, as trustees and beneficiaries of the trusts are promoters and their immediate family members.
"The proposed indirect acquisition would be a non-commercial transaction, which would not affect or prejudice the interests of the public shareholders of the Target company in any manner," the order said.
Under the SAST (Substantial Acquisition of Shares and Takeovers) rules, the acquisition of substantial shares or control generally requires an open offer to public shareholders.
However, exemptions can be granted in cases such as inter se transfers among promoters or internal restructuring.
Sebi said the exemption is subject to conditions, including the filing of a report within 21 days from the date of acquisition. The regulator also clarified that the exemption is limited to open offer requirements and does not waive other compliance obligations under applicable regulations.
The exemption from open offer obligations is valid for one year from the date of the order, within which the proposed acquirers must complete the acquisition; failing which it will lapse and cease to exist, Sebi added.