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Delisting a costly affair: Promoters must be ready to pay through the nose

Industry players said that public shareholders often get greedy with the asking price for tendering the shares

If the delisting bid goes through, the trade can be very rewarding. However, an unsuccessful attempt can cause agony to investors
Shareholders are allowed to place bids at any price above the discovered price

Taking a listed company private is a costly affair in India. The average delisting price sought by the public shareholders for the last nine delisting bids has been 2.4x the floor price set by the promoters.   While Vedanta failed to get the minimum bids required to delist, the indicative discovered price for the commodity major came in at Rs 320, 3.7x its floor price. In the case of Hexaware Technologies, the discovered price came in 80 per cent higher than the floor price.   Industry players said that public shareholders often get greedy with the asking price for ...