Listed firms having more than 200 non-QIB (qualified institutional buyer) holders of non-convertible debt instruments are now prohibited from delisting voluntarily under a new framework that Sebi has announced.
Sebi has announced a new framework that forbids listed businesses with more than 200 non-QIB (qualified institutional buyer) holders of non-convertible debt instruments from delisting voluntarily in an effort to protect investors’ interests. The listed firm must get approval from all holders of non-convertible debt securities under the new regulation within 15 working days of learning of the delisting. The current regulation permits firms to delist by notifying the stock exchange in advance of the board of directors meeting when the voluntary delisting request will be discussed.
However, organizations wouldn’t be allowed to selectively list some securities while delisting others.Additionally, it wouldn’t apply if non-convertible debt securities were delisted as a result of a stock exchange penalty or other action taken against the listed firm or as a result of the non-convertible debt securities being redeemed.
Additionally, the method would not be applicable to the delisting of non-convertible debt instruments issued by a listed corporation that were delisted in accordance with a resolution plan permitted under the Insolvency Cod. A listed firm that has “more than 200 securities holders, excluding qualified institutional buyers (QIBs) in any International Securities Identification Number relating to listed non-convertible debt securities or non-convertible redeemable preference shares” is now forbidden under the new regulation.
According to Sebi, the exchange must be informed of all significant facts on the proposed delisting of non-convertible debt securities, beginning with the presentation of the delisting agenda to the board of directors and continuing until the delisting is complete.
Within three working days of receiving in-principle permission from the exchanges, the listed firm must deliver the notice of delisting to the holders of non-convertible debt securities.
The listed firm must submit the final application for delisting to the exchange within five working days of the day it receives consent from all holders of non-convertible debt securities.
