Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: articles on VAT and GST in India :: due date for vat payment :: ACCOUNTING STANDARD :: list of goods taxed at 4% :: cpt :: TDS :: ACCOUNTING STANDARDS :: VAT RATES :: ARTICLES ON INPUT TAX CREDIT IN VAT :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: VAT Audit :: Central Excise rule to resale the machines to a new company :: empanelment
 
 
« News Headlines »
 How to link your Aadhaar and PAN details to file income-tax returns
 How to calculate capital gains tax on property sold at less than stamp value?
 Return Filing - Under GST, this is how you will file tax returns from July 1
 Income tax filing FAQs part 1
 Filing Income Tax Returns? Things To Keep In Mind As Deadline Approaches
 Filing of online return for 4th quarter of 2016-17- extension of period thereof.
 New tax accounting standards may reduce leeway for infrastructure companies
 GST – CONCEPT & STATUS – As on 01st May, 2017
 Govt extends VAT deadline, relief for developers
 Income Tax Appellate Tribunal Rules, 2017
 Got your Form 16? You should file income tax returns early to enjoy benefits

Sebi amends rights issue norms
August, 21st 2009

Capital market regulator Sebi has amended the rights issue norms that would now allow an issuer company to utilise the issue proceeds only after the basis of allotment of rights share is finalised.

Earlier, the issuer company was allowed to utilise the rights issue proceeds after satisfying the designated stock exchange that its rights offer had received minimum 90% subscription. The new amendment that has been brought in follows Sebis decision of late last year to cut short the time period for allotment of shares in rights issue to 15 days from the previous 45 days.

The Sebi circular said, In view of this it has been decided to amend clause 8.19 of the Sebi (DIP) guidelines to provide that the issuer company can utilise the issue proceeds only after the basis of allotment is finalised.

The amendment has brought more sanity to the rights issue norms, said Prithvi Haldea, managing director, Prime Database. An issue is considered complete only when the final allotment of shares is done.

A company using issue proceeds before the allotment process could land in trouble as any adverse development could happen in the issuer company. Thus by amending the rights issue Sebi has actually set the process right in a rights issue process, he said.

Further, Sebi has extended the facility of application supported by blocked amount (ASBA) to all rights issue which enables an investor to apply for an issue without making payment.

Instead, the amount is blocked in investors personal account with the designated syndicate bank and only the required funds will be debited from the account upon allocation of shares.

Currently Sebi had enabled the facility for applying through ASBA only in case of an initial public offer (IPO). The amendments also include rationalizing the disclosure norms during a rights issue.

According to the norms issuer companies are required to disclose only minimum information that will help in making the issuance process faster and also help in reducing cost.

The regulator felt the need for simplifying the norms for rights offer since companies were shying away due to its cumbersome process and resorting to other modes for raising capital.

The Sebi board which met on June 18, 2009 had noted that quite often, the issuers choose preferential offers or qualified institutional placements (QIP) or even American or global depository receipt ADR/GDR issuances over rights offers, as these other modes require less time, cost and efforts.

While alternate modes of issuances help entities to achieve their capital raising needs, they dilute the existing shareholders stake in the entity.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - We Bring IT. Offshore software outsourcing company. We use Global Delivery Model (GDM) and believe in Follow The Sun principle

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions