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SEBI tightens rules for pledged shares, MFs to shield minority shareholders

Promoters of a company will have to disclose reasons for having pledged shares when combined pledges exceed 20% of the total share capital in a company or 50% of their total shareholding in the firm.

Abhirup Roy | Reuters  |  Mumbai 

India's market regulator reinforced disclosure rules for when the shares in a company are pledged as collateral and tightened rules for mutual funds to try to protect minority shareholders and retail investors. Promoters of a company--often its main investors--will have to disclose reasons for having pledged shares when combined pledges exceed 20% of the total share capital in a company or 50% of their total shareholding in the firm, the Securities and Exchange Board of India (SEBI) said in a statement on Thursday. Such pledging refers to the use of shares as collateral when ...

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First Published: Thu, June 27 2019. 19:34 IST
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