Sebi breather for Pyramid Saimira founder

The Securities and Exchange Board of India (Sebi) on Monday disposed proceedings against Usha Saminathan, one of the promoters of Pyramid Saimira Theatre Ltd (PSTL). The regulator had issued the order in a case relates to allocation of warrants worth Rs 41.43 crore to Usha, wife of the company’s promoter director P S Saminathan.

Sebi probed the case after it was observed that PSTL, in a meeting of its board of directors on October 22, 2007, allotted 36,40,000 convertible warrants to P S Saminathan on preferential basis, at a price of Rs 310 per warrant.

The warrants were to expire on April 21, 2009. It was observed that on March 5 that year, Saminathan transferred warrants in favour of Uma. As another promoter of PSTL, she opted to convert 14,85,000 warrants into equity shares. Accordingly, on April 11, 2009, PSTL allotted 14,85,000 shares on conversion of warrants at Rs 310 per share. The amount payable to the PSTL for the exercise of these warrants was Rs 41,43,15,000.

Investigation concluded that the amount towards conversion of these warrants was received from various other third parties -- much beforethe actual date, when Usha opted to convert the warrants.

It was alleged that she did not pay the amount to PSTL for the conversion of warrants, and failed to pay the above consideration to PSTL for the conversion of warrants.

Sebi thus appointed Barnali Mukherjee as adjudicating officer to investigate the case.

On Monday, the officer said in his order that Rs 41.43 crore payable by Usha Saminathan, was received prior to the date of allotment. Further the auditor of the company vide certificate dated April 9, 2009 confirmed that PSTL received on various dates ranging from February 1, 2008 to February 28, 2009 the balance amount of application money amounting to Rs 41,43,15,000 towards allotment of 14,85,000 equity shares on conversion of equal number of share warrants.

“Considering the facts and circumstances of the case, I do not find the instant matter fit for imposition of penalty in terms of Section 15HB of the SEBI Act, 1992 and dispose of the proceedings accordingly,” said in the order.