In a major relief for ICICI Bank and ICICI Securities, the National Company Law Appellate Tribunal (NCLAT) on Monday dismissed petitions challenging ICICI Securities’ delisting process from the stock exchanges.
A Delhi-based two-member NCLAT bench, comprising Justice Yogesh Khanna and Technical Member Ajay Das Mehrotra, dismissed petitions filed by Quantum Mutual Fund and Manu Rishi Gupta, a public shareholder.
Quantum and Gupta had argued that the share swap ratio was unfair to minority shareholders and filed a petition in NCLAT against National Company Law Tribunal (NCLT) approval.
They also contended that the exemption granted by the market regulator Securities and Exchange Board of India (Sebi) and the valuation details were not adequately disclosed to shareholders.
NCLAT stated that Regulation 37 of the SEBI (Delisting of Equity Shares) Regulations 2021 provides an alternative delisting mechanism. It held that shareholders retain the right to exit and that the valuation process adheres to recognised methods.
NCLAT also said that the valuation report was prepared by independent valuers and supported by fairness opinions. Further, it stated that the contenders did not meet the threshold of holding at least 10% of the shareholding required to challenge the scheme under Section 230(4) of the Companies Act, 2013.
ICICI Securities announced plans in June 2023 to delist and merge with its parent company, ICICI Bank. As per the arrangement, shareholders were set to receive 67 shares of ICICI Bank for every 100 shares of ICICI Securities.
In March 2024, about 72% of shareholders supported this plan. NCLT had earlier dismissed the objections to the delisting given it was approved by a majority of shareholders and complied with all legal and regulatory requirements.
ICICI Securities was listed on the bourses in March 2018. Promoted by one of India’s largest private sector lenders (ICICI Bank), ICICI Securities is a key player in the financial product market and investment banking services.
The delisting is expected to smoothen its operational alignment with ICICI Bank.