LECTURE 14

Question 1

To whom shall the public offer be made? and what is the exception?

Answer 1

1. all the share holders of the target company whose name appear in the register of members as on the date mentioned in the public announcement
   Exception
   Provided that the public offer is made in pursuant to an agreement to acquire shares or control of the target company the offer letter shall be sent to the shareholders other than the parties to the agreement

Question 2

What is an acceptance period in relation to the public offer?

Answer 2

the period commencing from the 48th day of the public announcement of the public offer and closing with the close of the public offer which shall not be later than the 54th day of the date of the public announcement.

Question 3

What is the date of public announcement in relation to the public offer?

Answer 3

the date on which the public announcement is published on the newspaper

Question 4

Who shall receive the offer letter in relation to public offer?

Answer 4

1. shareholders whose names are appearing in the register of members of the target company on the date of book closure
2. custodians of Global depository receipts
3. custodians of American depository receipts
   and holders of convertible securities ( where the conversion period falls within the offer period)

Question 5

In which schedule the specifications of the offer letter are mentioned?

Answer 5

Schedule I

Question 6

What are the mandatory disclosure requirements relating to the acquisitions of shares pursuant to section 109 of the act i.e. exceptions where takeover regulations do not apply?

Answer 6

within 2 working days of the acquisition of shares shall make a disclosure of the acquisition to the target company, the securities exchange and the commission containing the information as prescribed in schedule II

Question 7

What are the disclosure requirements for acquirer in case an acquirer acquires voting shares beyond 10%?

Answer 7

within 2 working days of the acquisition of the shares make a disclosure to the target company the securities exchange and the commission containing the information as prescribed in schedule III

Question 8

What are the disclosure requirements for the acquirer in case he acquires additional voting securities after a period of 12 months ?

Answer 8

within 2 working days of the acquisition of the shares make a disclosure of the acquisition to the target company, the securities exchange and the commission containing the information contained in Schedule IV

Question 9

In what situation the target company is required to make a disclosure regarding the acquisition?

Answer 9

Firm intention to acquire control
unusual movement in share price
when negotiations are about to commence with the potential acquirer
directors etc entering into negotiations for sale

a firm intention to acquire control or voting shares of the target company beyond the limits prescribed in the section 111 of the act is notified to the target company
2. when the target company is subject of rumor and speculation or there is an unusual movement in its share price or traded volume and there are reasonable grounds from concluding that it is the potential acquirer’s actions that led to this
3. when the negotiations or discussions are about to commence with a person for acquiring control or voting shares of the target company beyond the limits prescribed in section 111 of the Act
4. when a director or chief executive and/ majority shareholders of a target company informs the target company that they individually or in concert with each other or their family members or associates are entering into negotiations for sale of their shareholding beyond the limits prescribed in section 111 of the act

Question 10

which schedule prescribes the information regarding the disclosure by the target company regarding the acquisition?

Answer 10

schedule 5