Under the plan that has been cleared by Sebi, P&G will also sell 0.9% from its current 44.2% holding in GIL in the open market. Post the shareholding reorganization, the Poddars will hold less than 5% in the company, have no board seat and will b e treated as a public shareholder. Since the proposed stake hike by P&G in GIL is aimed at meeting Sebi rules for public holding, it will not trigger any open offer, a letter from the regulator said.
Sebi also said that it had no objection to P&G paying severance compensation to the Poddars, provided that the same is paid by P&G without any recourse to GIL and the interest of the existing minority shareholders of GIL is safeguarded.
The market regulator stipulates that in all private sector companies, at least 25% shares should be held by non-promoting shareholders. Sebi had put a June 2013 deadline for all listed entities to comply with this rule. Since GIL did not comply with the rule before the deadline, Sebi imposed several strictures on the company and its promoters, including nonpayment of part of the dividend till the company increased its public shareholding to 25%. At present, only 11.2% of GIL's stake is held by public shareholders.
According to the shaving products maker's latest shareholding pattern, P&G holds 44.2%, while the Poddar group holds 44.5%, and the balance is with the public.
via Business - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNGTWQea6k_Y36TqWebJDlR46WuxFw&url=http://timesofindia.indiatimes.com/business/india-business/Poddar-group-to-reduce-stake-in-Gillette-India/articleshow/23129732.cms
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