Sebi suspects share price foul play through open offers
As a safeguard mechanism, the market regulator is mulling over delinking the open offer price from the prevailing market rates and linking it entirely with the price agreed upon between the acquirer and sellers. However, any decision in this regard would require much more consultations, the official said.
With regard to 'frivolous' open offers, the Sebi board has already been apprised of the apprehension that some acquirers may use these offers as a means to influence the market price and subsequently, may attempt to withdraw the offer on the pretext that the subsequent acquisition was not successful.
In this regard, it has been proposed that such acquirer should not be allowed to withdraw the open offer on such grounds and certain deterrents be put in place for the
acquirers in making frivolous offers to public shareholders.
Sebi had implemented a major overhaul of its takeover regulations in October 2011, while certain changes were made to these norms last month based on the experience gained from the market and to bring in more transparency for the benefit of public shareholders as well as the corporates.
The regulator may consider further changes to the takeover norms, based on feedback from investors and other entities.