NEW DELHI: Markets regulator Sebi today exempted a private family trust related to the promoter group of Renaissance Jewellery from the obligation of making an open offer following its proposed acquisition of 15 per cent stake in the firm.
Kothari Descendents Private Trust had sought exemption from the obligation of making open offers post acquisition of certain number of shares in Renaissance Jewellery.
Under the proposed acquisition, the trust would be acquiring 15 per cent of the shares of Renaissance Jewellery as a gift from the company's promoter Niranjan Shah, who is also a trustee of Kothari Descendents Private Trust.
Accordingly, the trust would be acquiring an additional 15 per cent shareholding in the company, which exceeds the stipulated threshold of an additional 5 per cent.
Presently, the acquirer trust does not hold any equity shares of the company.
In an order, Sebi has granted exemptions to the trust from making the open offer, saying the proposed acquisition would take place pursuant to a private family arrangement intended to streamline succession and welfare of the Niranjan Shah family.
Besides, it would be a non-commercial transaction (gift at nil cost) which would not affect or prejudice the interests of the public shareholders of the the company in any manner, the regulator said.
Further, the Securities and Exchange Board of India (Sebi) noted that there will be no change in control of Renaissance Jewellery pursuant to the proposed acquisition.
"The pre-acquisition and post-acquisition shareholding of the promoters in the target company will remain the same," Sebi noted.
While providing the exemption with certain conditions, the watchdog also said the proposed acquisition should be in accordance with the relevant provisions of the Companies Act and other applicable laws.
Subsequently, the trust is required to file a report with Sebi within 21 days.
Under takeover regulations, acquisition of shares beyond a certain threshold triggers the open offer obligation.