THE recent directive by the Securities and Exchange Board of India (Sebi) relating to updations in the offer documents for initial public offerings could make the process as tedious as filing a fresh offer document, say some merchant bankers. “Filing a fresh document with new changes would be very much similar to filing a fresh document,” says a senior merchant banker with a domestic brokerage firm. “I agree companies cannot go on making changes, but at the same time there is no time bound commitment from the regulator that it will be taken on a fast-track basis,” he says. In February this year, the regulator had extended the validity of its approval for IPOs and rights issues to 12 months from three months earlier. The regulator had also said that before the opening of the issue, every issuer shall file an updated offer document with the board at least one month prior to filing it with the Registrar of Companies or the stock exchange. It has now specified the details that will constitute sign i f i c a n t changes and the additional fees. The new circular says changes in sections like any material development in risk factors, an aggregate increase of 5%, or more shareholding of promoters, change of more than 10% in the estimated issue size or estimated means of finance, change of more than 10% in estimated deployment of funds, among others, as reasons required for fresh filing of draft offer document with the board. The move came after Sebi observed that in some cases material changes informed by merchant bankers resulted in major deviations from the draft offer document that was available in public domain and called for fresh scrutiny/processing of the draft offer document by the Sebi board. “I feel that more than 10% change with respect to change in the estimated issue size, or estimated means of finance and deletions to the objects of the issue size, or estimated means of finance by the same percentage may not be very harsh if this would result in putting in better checks and balances. The main issue is that it should be cleared in a timebound manner,” adds another merchant banker at a firm, which has a couple of IPOs lined up in the next few months.
--~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en -~----------~----~----~----~------~----~------~--~---
