New Delhi: The cash-strapped Kingfisher — which is desperately looking for foreign investors to salvage it — has sought an exemption from the Securities and Exchange Board of India (Sebi) to allow its investors to buy into the company without having to go for an open offer.
According to Sebi's present Substantial Acquisition of Shares and Takeovers Regulations, any foreign company that buys over 24.99% stake in an Indian firm has to go for an open offer for 26% (in case of airlines 24% as the sectoral cap for FDI is 49%).
Industry sources say Kingfisher chief Vijay Mallya has asked the market regulator and finance ministry to offer certain relaxations from this norm as it poses to be one of the biggest road blocks in the airline's plans to sell its stake.
“Mallya is negotiating with Sebi and the finance ministry to work out the open offer issue. He is in advance talks with some investors in the UK and Dubai who have raised concerns over the open offer rule,” a senior government official said on the condition of anonymity.
26/12/12 Financial Express
