Sebi bars two Sahara cos from raising funds
TIMES NEWS NETWORK Mumbai: Market regulator Sebi on Wednesday barred two Sahara Group companies—Sahara Real Estate Corp and Sahara Housing Investment—from raising funds from the market and, in effect, delayed the launch of the IPO for Sahara Prime City, another group company. The market regulator also issued a showcause notice against the two companies on why it should not take action against them for issuing convertible bonds without Sebi’s permission and barred them from issuing such bonds, termed as optionally fully convertible debentures (OFCDs). In its order, Sebi also said that when asked for documents and explanation for issuing such convertible bonds, the Sahara Group companies had said that the instruments which they had issued did not come either under the jurisdiction of Sebi or the National Housing Bank (NHB). The Sebi order stated that both the companies, “…instead of providing the information sought by Sebi, (they) have adopted various means and adopted convenient pleas for not providing the information and delaying the examination process initiated by Sebi to ascertain the facts.’’ Reacting to the Sebi order, the Sahara Group said that the regulator’s move was wrong and the allegation that the group did not supply the document asked for was incorrect. “Besides the letter that was sent to Sebi earlier in this regard, where it is clearly mentioned that this OFCD matter is definitely out of the jurisdiction of Sebi, we had given them clear opinions that it is a ministry of corporate affairs matter,’’ said the Sahara Group. “The clear opinions given by Justice A M Ahmadi, former Chief Justice of India, C Achuthan, former presiding officer, Securities Appellate Tribunal, Mumbai, and by Justice SP Kurdukar, former Supreme Court judge and by few more... all these opinions clearly stated that this matter is not under the jurisdiction of Sebi,’’ the group further added. On its part, the Sebi order pointed out that the two Sahara Group companies together were raising about Rs 40,000 crore, more than the Rs 24,696 crore raised during 2009-10 through IPOs. “This raises serious concerns for the safety of the funds of the investors who have subscribed to the OFCDs issued by the said companies. As the capital market regulator, Sebi has to intervene to ascertain as to whether such issues to the public are in compliance with the applicable laws governed by it,’’ the order said. -- 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.
