Birla MF fined for Subex deal

The fund had acquired a 7.06% stake of Subex Systems.

The Securities and Exchange Board of India (Sebi) today fined Birla Mutual Fund for non-disclosure under the Takeover Regulations.

The fund was found to have acquired a 7.06 per cent stake of Subex Systems Ltd (SSL) between September 7 and December 31, 1999 under its various schemes but did not disclose it to the company.

The fine of Rs 75,000 has to be paid within 45 days from the date of receipt of the order.

When contacted, a senior Birla MF executive refused to comment on the issue. "The fund was required to disclose their aggregate shareholding in SSL to SSL, within four working days of October 18, 1999, the date on which the MF crossed the threshold limit of 5 per cent of the voting rights in SSL," the Sebi order said.

As the fund failed to make the necessary disclosures to SSL about the acquisition within the stipulated period, it was found to have contravened the provisions of the Takeover Regulations, the order said.