Delisting: SEBI allows counter offer by promoters

Sebi has allowed promoters to make counter offer to shareholders of companies that are planning to delist from stock exchanges, a move aimed at plugging loopholes in the current method.

The Sebi has put in place a system for price discovery as per reverse book building (RRB) method, along with considering counter offer of promoter.

Currently, if the price discovered through reverse book building is not attractive to the promoter, he may unilaterally reject the price and the whole exercise becomes futile.

Under the new rules, the promoter will be allowed to make counter offer to the shareholders. If the counter offer is lucrative to the shareholders and if it is accepted, delisting will be treated successful.