On 1-9-2025, the Securities and Exchange Board of India notified the Securities and Exchange Board of India (Delisting of Equity Shares) (Amendment) Regulations, 2025 to amend the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021. The provisions came into force on 2-9-2025.
All you need to know:
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The amendment has introduced Special Provisions for Delisting of Public Sector Undertaking.
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These regulations will apply with necessary modifications to Public Sector Undertakings (‘PSUs’).
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Exceptions:
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Banks;
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Non- Banking Financial Companies (‘NBFCs’);
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Insurance Companies.
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Minimum shareholding- the acquirer and other Public Sector Undertakings together will hold at least 90% of the total issued shares of that class.
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Approval: A special resolution should be passed through postal ballot or e-voting, and the explanatory statement to the notice should include all material facts about the delisting.
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Delisting should be done through a fixed price process.
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Floor Price Determination: It cannot be less than the highest of:
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52-week-volume-weighted average price of acquisitions;
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26-week highest price paid for any acquisition;
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Under a joint venture report obtained Valuation from 2 independent valuers- considering valuation parameters such as book value, adjusted book value, comparable trading multiples, income approach and any other customary valuation metrics as applicable for valuation of shares of companies in the same industry.
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The final delisting price can be at least 15% higher than the highest price as laid down in Floor Price Determination.
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Where a public sector undertaking whose shares have been delisted undertakes voluntary strike-off, and if such strike-off is effected after 1 year from the date of delisting but not later than 30 days from the expiry of such 1 year period, then such strike-off shall be subject to fulfilment of the following conditions-
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Funds due to stockholders who did not tender their shares during delisting will be transferred to a designated account of the stock exchange and this account will hold funds for 7 years during which the investors can claim their dues.
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After completion of 7 years, the unclaimed amount will be transferred to the c under the Companies Act, 2013.
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If the unclaimed amount cannot be transferred to the Investor Education and Protection Fund then it will be transferred to the Investor Education and Protection Fund of the Board.
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After the transfer to either of the Funds, the investor can claim the payable amount from the designated Stock Exchange, which in turn may claim reimbursement from the aforesaid fund.
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