Exit Offer to Dissenting Shareholders
Exit Offer to Dissenting Shareholders:Bhargavi Zaveri, Shefali Malhotra, Sumant Prashant and Prateek Mishra Response to SEBI Discussion Paper, December 2015.
The Companies Act, 2013 (Act) obligates the promoters and the majority shareholders of a listed company to buy-out dissenting shareholders, where the company has passed a special resolution (a) amending the terms of a contract referred to in the prospectus; and (b) amending the main object for which the money was raised from the public. The Act requires SEBI to frame regulations for the exercise of the exit right by the dissenting shareholders. SEBI issued a discussion paper on this subject seeking public comments. In our response to the discussion paper, we recommend: