Why did the SAT remove TMB’s initial public offering?

MUMBAI : Tamilnad Mercantile Bank’s Initial Public Offering (IPO) was 83% registered on the first day on Monday, received an offer to buy 72,56,228 shares compared to the 87,100,000 shares offered. offering after going through a series of legal challenges in court, with regulators and the courts.

The quota for retail investors to be registered 1.53 times, qualified institutional buyers to register 73% of their shares, and non-institutional investors to bid 58%.

On September 2, the Securities Court of Appeals (SAT) dismissed the minority shareholders’ appeal for staying in the IPO. Under the order, published on Thursday, the SAT rejected the bank’s call for investors on three grounds. One, no appeal was made to allow shareholders to bid for their shares. Second, the exemption from submitting the new draft red herring prospectus does not violate the legal rights of shareholders. Third, the IPO process is based on disclosure and all full disclosures have been made.

Six foreign investors, Robert and Ardis James Co., East River Holdings, Swiss Re Investors (Mauritius), Kamehameha Mauritius, Cuna Group (Mauritius) and FI Investment, have urged SAT to proceed with the IPO. They oppose the move to withdraw the offer to sell (OFS) from the public offering.

In January, shareholders filed a separate written petition before an assigned bench of Bombay high court seeking an order directing the Securities and Exchange Commission of India (Sebi). only accept the DRHP after allowing the plaintiffs to participate and bid for shares on a commensurate basis.

The SAT under its orders stated that no such appeal had been made previously and as a basis for dismissing the appeal. It also said shareholders had the right to appeal Sebi’s decisions only if ‘objected’ by the order.

Six shareholders wanted to participate in OFS, but it was withdrawn on May 11 by the bank’s board of directors. The Tamilnad bank then approached Sebi to request an exemption from submitting the new draft prospectus, which was authorized by the market regulator under the May 12 order.

“In our view, appellants cannot be barred by Sebi’s waiver. SAT said.

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