Sebi exempts family trusts related to Minda Corp from open offer obligation

Markets regulator Sebi has granted exemption to two family trusts linked to Minda Corporationfrom obligation of making an open offer following proposed acquisition of shares in the company.

Sebi had received an application fromAshok Minda Family Investment Trust and Sarika Minda Family Investment Trustseeking exemption from the applicability of SAST (Substantial Acquisition of Shares and Takeovers) in the matter of proposed acquisition of shares and voting rights in Minda Corp.

The proposed transaction involves acquisition of35.85 per cent stake in Minda Corp byAshok Minda Family Investment Trust and76.34 per cent stake of Minda Capitalheld by Ashok Minda, without any consideration.

Besides,Sarika Minda Family Investment TrustCorp is proposed topick up 14.7 per cent shareholding in Minda Corp and 12.48 per cent stake of Minda Capital held by Sarika Minda, without any consideration.

The transactions would result in direct acquisition of 50.55 per cent stake in Minda Corp by the two trusts held by Ashok Minda and Sarika Minda, and indirect acquisition of 17.55 per cent stake held by them through Minda Capital and Whiteline Barter Ltd.

The proposed acquisition of 68.1 per cent stake in Minda Corp by the trusts will attract the Takeover Regulations.

In an order on Wednesday, Sebi granted exemption to the trusts from making an open offer as there will be no change in control of Minda Corp pursuant to the proposed share purchase.

In addition, the regulator noted that the total pre-acquisition and post-acquisition shareholding of the promoters in the firm will remain the same.

"There will also be no change in the public shareholding of the target company," the Securities and Exchange Board of India (Sebi) noted.

Accordingly, the regulator granted "exemption to the proposed acquirers, Ashok Minda Family Investment Trusts,Sarika Minda Family Investment Trust, from complying with the requirements of...the Takeover Regulationswith respect to the proposed acquisitions in the target company, viz. Minda Corporation., by way of proposed transactions.

This is subject to certain compliance with the relevant provisions of the Companies Act, it added.