Chandigarh29.03.2008

Regulation 3(3)

Regulation 3(4)

Regulation 3(5)

Regulation 6

Regulation 7

Regulation 8

Regulation 10, 11 & 12

Regulation 20(4) & 20(5)

Clause 40A of Listing Agreement

Disclosures & Compliances

Open Offer Provisions

Pricing Provisions

Minimum Public Shareholding

Regulation 3 (1) Exemptions under Takeover Code

Regulation 4 Takeover Panel Exemptions

Acquisition of more than 5%, 10%, 14%, 54% & 74% [Regulation 7]

Persons, who are holding between 15% - 55%, acquisition/ sale aggregating more than 2% or more voting rights [Regulation 7(1A)]

Person holding more than 5% shares [Regulation 6]

Acquisition more than 15% or more voting rights [Regulation 10]

Persons, who are holding between 15% - 55%, acquisition more than 5% or more voting rights in a financial year.[Regulation 11(1)]

Persons, who are holding more than 55%, acquisition of single share or voting right [Regulation 11(2)]

Intimation to Stock Exchange Regulation 3(3) & Report to SEBI (Regulation 3 (4) is required to be filed in every case.

CCOMPARISON OF SOME KEY OMPARISON OF SOME KEY TERMSTERMS

Vs.

“SEBI Takeover Code is applicable on acquisition of voting rights beyond the specified limits.”

Nagreeka Exports Limited, Jain Irrigation Systems Limited

Vs.

“A person may acquire control over a Company without acquiring the shares. Acquisition of shares is covered under regulation 10 & 11 whereas acquisition of control is covered under regulation 12”

RREGULATION 6 & 8 – EGULATION 6 & 8 –

CONTINUAL DISCLOSURESCONTINUAL DISCLOSURES

RREGULATION 7 – EGULATION 7 –

EVENT –BASED DISCLOSURESEVENT –BASED DISCLOSURES

RREGULATION 10, 11 & 12 – EGULATION 10, 11 & 12 –

PUBLIC ANNOUNCEMENTPUBLIC ANNOUNCEMENT

Regulation Existing holding (Any person already

holding…)

Shall not acquire

shares or voting rights entitling him to exercise

Voting rights

Maximum Allowable Holding

10 0-15% 15% or more voting rights

11(1) 15%-55% Additional 5% more voting rights

11(2) 55%-75% Any single share

12 Shall not acquire control over the target company

Unless such person makes a PUBLIC ANNOUNCEMENT to acquire such shares in accordance with the regulations.

Whether the Acquirer is eligible for exemption??

NO

•What is the relevant date for deciding the eligibility for availing exemption??

Regulation 3 comes into play only if a violation of the substantive clauses 10, 11 or 12 is first established. Therefore, the date of claiming exemption under regulation 3 cannot be prior to the date when regulation 10, 11 or 12 is attracted.

•Whether acquisition of shares pursuant to conversion of warrants is an involuntary acquisition and hence eligible for exemption??

The acquisition of shares and consequent voting rights is out of a voluntary action on the part of the Acquirers and it is not due to compulsion under or operation of any law. Hence, such acquisition is not exempt.

PPAYMENT OF NON-COMPETEAYMENT OF NON-COMPETE

CONSIDERATIONCONSIDERATION

RREGULATION 3 – EXEMPTIONSEGULATION 3 – EXEMPTIONS

On 16.01.2006 , A & B gave an Open Offer.

With in 3 years

On 19.12.2006, A agreed to transfer his shareholding to B

A & B were shown as promoters in the Open Offer.

The exemption was claimed u/r 3 (1) (e) (iii) (b).

The regulation applicable in this case is regulation 3 (1) (e) (iv), therefore since the promoters are not acquiring shares after three

years from the date of closing of open offer , the acquisition is NOT EXEMPT.

SEBI Decision:

X Ltd (Foreign

Company)

Y Ltd (Foreign

Company)

Z Ltd (Indian Listed

Company)

Scheme of Arrangement approved by HC of a Foreign Country

HoldingCompan

y

Subsidiary

Company

•Whether the indirect acquisition of shares of an Indian Company pursuant to a scheme of arrangement approved by the High Court of a foreign country will be exempt under regulation 3(1)(j)(ii) of SEBI Takeover Regulations, 1997?

Yes, because section 3(1)(j)(ii) of Takeover Regulations provides exemption from regulation 10, 11 & 12, in case of acquisition of shares pursuant to a scheme of arrangement or reconstruction including amalgamation or merger or demerger under any law or regulation, Indian or foreign.

Therefore, acquisition of shares pursuant to a scheme of arrangement approved by a foreign court will also be exempted.

RREGULATION 4 – A STUDY ONEGULATION 4 – A STUDY ON

SOME GROUNDS & ISSUES…SOME GROUNDS & ISSUES…

Acquisition of 14.99% Shares.

Acquisition of Control by passing a Special resolution through Postal Ballot u/r 12.

Merger of the Target Company with the

Acquirer Company.

Choice of Company for Investment

Decision of Investment vis-a-vis various laws.

Due Diligence of Company

Market Perception about the Company

Anticipation of Competitor

Cost of Investment

Decision as to acquisition type ╚ Acquisition of Shares╚Acquisition of Control╚Acquisition of Shares and Control

Mode of Acquisition╚ Through Open Offer╚ Through Postal Ballot