SEBI vide circular dated 25th September 2024 has issued the Securities and Exchange Board of India (Delisting of Equity Shares) (Amendment) Regulations, 2024. The amendment provides that when delisting is proposed upon acquisition, acquirer shall open an interest bearing escrow account with a Scheduled Commercial Bank, not later than seven working days from the date of obtaining the shareholders’ approval, and deposit there in an amount equivalent to twenty-five percent of the total consideration, calculated as below:
- In case delisting is proposed through reverse book building process; the total consideration shall be calculated on the basis of the number of equity shares outstanding with the public shareholders multiplied with the floor price or the indicative price, if any given by the acquirer whichever is higher;
- In case delisting is proposed through the fixed price process; the total consideration shall be calculated on the basis of the number of equity shares outstanding with the public shareholders multiplied with the fixed delisting price offered by the acquirer.
Before making the detailed public announcement, the acquirer shall deposit in the escrow account, the remaining consideration amount being seventy-five percent of the total consideration amount.
The acquirer through the Manager to the offer shall, within two working days from the closure of the bidding period or the tendering period, make a public announcement in the same newspapers in which the detailed public announcement of these regulations was made, of the success or failure of the fixed price delisting process or the reverse book building process and also disclose the discovered price accepted by acquirer, in the event of success of the reverse book building process.
