Sebi removes curbs on Brady & Morris, Gujarat Themis Biosyn
Market regulator Sebi today revoked the restrictions it had imposed on Gujarat Themis Biosyn and
Brady & Morris Engineering Company as well as their directors and promoters for not meeting the minimum public shareholding norms.
Sebi has revoked the curbs on Brady & Morris and its promoters and directors but has referred the case for adjudication proceedings "to levy suitable monetary penalty" as the firm did not adopt the methods available for complying with the minimum 25 per cent public holding requirements prescribed by the regulator.
Brady and Morrison had submitted that owing to market conditions, among other, it was not favourable for the company to come out either with a bonus issue or a rights issue. The firm had thereby sold 7.11 per cent of its stake in open market to Transparent Agro and others. After this, its promoter holding was reduced to 73.75 per cent.
Securities and Exchange Board of India (Sebi) noted that the sale of 7.11 per cent stake by the firm in the open market "is not a prescribed mode of compliance" and that the firm had not sought the regulator's permission for open market sale.
Over 100 companies, including Gujarat Themis Biosyn and Brady & Morris Engineering Company, had failed to achieve 25 per cent public holding by June 3 and were imposed with various curbs by the market regulator on June 4.
In its order against Gujarat Themis Biosyn, Sebi said it is vacating the directions in the interim order dated June 4, 2013 against the firm, its directors, and promoters with immediate effect on condition that it achieves the minimum public holding by March 31, 2014.
Sebi said that the curbs "shall immediately be revived(without the need for passing of a separate order) against the said company, its directors, promoters and the promoter group "if the company fails to meet norms by end of March .
The March 31 deadline is based upon an order of the Board for Industrial and Financial Reconstruction (BIFR). BIFR found Gujarat Themis Biosyn to be a sick company and had given it a period of 3 years to meet the minimum public holding.
In its June 4 order, Sebi had frozen the voting rights and corporate benefits of promoters/directors of non-compliant firms and barred them from holding any new position on boards of listed firms, among others.
Further, the regulator had warned the firms of further actions including levy of monetary penalties, initiation of criminal proceedings, restricting the trading activities of related stocks and other possible directions.
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