If a Publicly listed company wants to go private. Can they force the shareholders to sell their Shares ?
Consider I have 100 Shares of Company A, The Company decides to go private after shareholders approval and buys back shares at premium. But I do not want to sell. Is this possible ? or by default all outstanding Shares will be bought back ?
I think you will keep your shares no matter wheather company is being delisted or not.
I don’t think anyone can force shareholder to sell his shares .
@a13989 @Prakhar_Agrawal There has been many cases where the rule of compulsorily extinguishing only non promoters shares by paying cash as per court order ,was used after d listing . Cadboury , Alfa laval , digiglobal soft , Raybun sun glass etc etc are the examples and Philips india and Bharti telecom ,Nirma are live cases in process.
in all the cases either amount paid was much less than d listed price ( raybun sun glass paid much less than what was paid before 8 years when the company was d listed ) same amount paid ( alfa laval after 4-5 years ) or amount paid was not even covering bank fd interest of 14-15 years (Cadboury paid rs 2014 in the year 2014 ).
Another example is increasing face value of share to one lakh rs per share thus automatically extinguishing most (not all ) non promoter shareholders. Bosh chasis , micro ink , sai services etc etc are the examples.
@a13989 @Prakhar_Agrawal ; AN AMUSING Announcement through an official letter to BSE by listed company KHODAY INDIA LTD :::
Pursuant to the legal opinion which was unanimously accepted and adopted by the Board of Directors of the Company at its meeting held on 24th May 2018 and it was resolved by the Board to forthwith cease / discontinue the Company’s compliances under Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015 and the Schedules thereto.
Accordingly, it is informed that the Company will forthwith cease / discontinue it’s compliances and periodical disclosures & reporting under Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015 and the Schedules thereto.
@a13989 @Prakhar_Agrawal @adc : With this proposed 65% maximum holding for promoters , many promoters specially MNC 's where the holding is more , may plan for taking the company private .
***** it is learned that it is only an advice /request to mull if making maximum 65% promoter hold is feasible . IT IS NOT A budget PROPOSAL OR RECOMMENDATION by FM to SEBI .