New Delhi- Markets regulator Sebi on Tuesday exempted the Jammu and Kashmir government from making an open offer to the shareholders of Jammu and Kashmir Bank following a proposed equity infusion that would hike the promoter stake by 6.06 per cent in the lender.
The directive comes after Sebi received an application from the bank on behalf of its promoter, the Government of Jammu and Kashmir, seeking exemption from the open offer obligation arising under SAST (Substantial Acquisition of Shares and Takeovers) norms due to the proposed acquisition.
The government of Jammu & Kashmir is infusing a capital up to Rs 500 crore towards equity infusion or recapitalization of the bank against allotment of equity shares.
The bank will allot 16,76,72,702 equity shares at Rs 29.82 apiece.
During the financial year 2021-22, post the preferential allotment, the proposed acquirer”s shareholding will increase from 68.18 per cent to 74.24 per cent i.e., a change of 6.06 per cent, which is in excess of 5 per cent of the equity paid–up capital of the bank, thereby attracting the provision of the Takeover Regulation.
In its order, Sebi said there will be no change in control of Jammu and Kashmir Bank following proposed acquisition as the change will only be in the quantum of holding the shares by the government who in fact is the promoter of the bank and will remain promoter and entity in control of the lender.
The bank, pursuant to the completion of the proposed Acquisition, will however remain compliant with the minimum public shareholding requirement of 25 per cent.
Sebi, further, said the infusion of additional capital by the government is stated to be utilized to improve the capital adequacy and to fund general business needs of the bank.
Accordingly, the regulator has granted “exemption to the proposed acquirer, viz., the Government of Jammu and Kashmir, from complying with the requirements of the Takeover Regulations with respect to the proposed acquisition of 6.06 per cent equity shares in J&K Bank in 2021-22.
Follow this link to join our WhatsApp group: Join Now
Be Part of Quality Journalism |
Quality journalism takes a lot of time, money and hard work to produce and despite all the hardships we still do it. Our reporters and editors are working overtime in Kashmir and beyond to cover what you care about, break big stories, and expose injustices that can change lives. Today more people are reading Kashmir Observer than ever, but only a handful are paying while advertising revenues are falling fast. |
| ACT NOW |
| MONTHLY | Rs 100 |  |
| YEARLY | Rs 1000 | |
| LIFETIME | Rs 10000 | |
