Sebi revokes curbs against Sundaram-Clayton

Market regulator said the company has compiled with the minimum public shareholding norms

Capital market regulator Sebi today revoked the restrictions it had imposed on auto components maker Sundaram-Clayton, its directors and promoters for failing to meet the 25% minimum public shareholding.

Lifting of curbs follows the company's meeting the minimum public shareholding requirements.

"Hereby revoke the directions vide the interim order dated June 4, 2013 against the company, Sundaram-Clayton Ltd, its directors, promoters and promoter group, with immediate effect," Securities and Exchange Board of India said in an order today.

Sebi said it did not propose to initiate any further action against Sundaram-Clayton as the company has "complied with the minimum public shareholding (MPS) norms, though belatedly".

As per Sebi norms, all listed private sector companies were to achieve 25% minimum public shareholding by June 3, 2013.

Sebi had issued order on June 4 against 105 private firms including Sundaram-Clayton for not complying with minimum public shareholding norms within the deadline.

Through the June 4 order, regulator had imposed various restrictions on the non-compliant companies, their promoters and directors for not meeting the norms.

It had also frozen the voting rights and corporate benefits of promoters/directors of these companies and barred them from holding any new position on boards of listed firms, among others.

Sundaram-Clayton had submitted to Sebi that for the purpose of achieving minimum public holding, it had undertaken an issue of 12.64 lakh shares through an Institutional Placement Programme (IPP) in July this year.

The company said that one of its promoters also sold 4 equity shares on July 11, 2013 through Offer for Sale.

"The Public shareholders presently hold 25%, which is the minimum shareholding required to be held by public shareholders in a listed company, under the MPS norms," the order today said.

However, Sebi noted that Sundaram-Clayton had delayed in meeting the public holding requirements "when it was under notice for three years for achieving such compliance".

"The company is warned for its conduct and is advised to ensure compliance with all the applicable laws and regulations administered by Sebi, in letter and spirit," the regulator said.