valid as on 28/03/2024

Regulation 3. Substantial acquisition of sharesor voting rights
Effective date 23.10.2011

Substantial acquisition of shares or voting rights.

3. (1) No acquirer shall acquire shares or voting rights in a target company which taken together with shares or voting rights, if any, held by him and by persons acting in concert with him in such target company, entitle them to exercise twenty-five per cent or more of the voting rights in such target company unless the acquirer makes a for acquiring shares of such target company in accordance with these regulations.

(2) No acquirer, who together with persons acting in concert with him, has acquired and holds in accordance with these regulations shares or voting rights in a target company entitling them to exercise twenty-five per cent or more of the voting rights in the target company but less than the maximum permissible non-public shareholding, shall acquire within any financial year additional shares or voting rights in such target company entitling them to exercise more than five per cent of the voting rights, unless the acquirer makes a public announcement of an open offer for acquiring shares of such target company in accordance with these regulations:

the acquisition beyond five per cent but upto ten per cent of the voting rights in the target company shall be permitted for the financial year 2020-21 only in respect of acquisition by a promoter pursuant to preferential issue of equity shares by the target company.

Provided that such acquirer shall not be entitled to acquire or enter into any agreement to acquire shares or voting rights exceeding such number of shares as would take the aggregate shareholding pursuant to the acquisition above the maximum permissible non-public shareholding.

acquisition pursuant to a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, 2016 [No. 31 of 2016] shall be exempt from the obligation under the proviso to the sub-regulation (2) of regulation 3

Explanation.— For purposes of determining the quantum of acquisition of additional voting rights under this sub-regulation,—

i. gross acquisitions alone shall be taken into account regardless of any intermittent fall in shareholding or voting rights whether owing to disposal of shares held or dilution of voting rights owing to fresh issue of shares by the target company.

ii. in the case of acquisition of shares by way of issue of new shares by the target company or where the target company has made an issue of new shares in any given financial year, the difference between the pre-allotment and the post-allotment percentage voting rights shall be regarded as the quantum of additional acquisition .

3. For the purposes of sub-regulation (1) and sub-regulation (2), acquisition of shares by any person, such that the individual shareholding of such person acquiring shares exceeds the stipulated thresholds, shall also be attracting the obligation to make an open offer for acquiring shares of the target company irrespective of whether there is a change in the aggregate shareholding with persons acting in concert.

 

 For the purpose of this regulation, any reference to “twenty-five per cent” in case of listed entity which has listed its specified securities on Innovators Growth Platform shall be read as “forty-nine per cent”.

 

Refer SEBI Circular dated 15.02.2023 on introduction of Issue Summary Document (ISD) and dissemination of issue advertisements. To view the Circular, Click Here. To view the format for ISD, Click Here
Inserted vide the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2020 dated 16.06.2020. To view the Notification, Click Here
Inserted vide the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2018 dated 31.05.2018. To view the Notification, Click Here
Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2016, w.e.f. 17-02-2016. To view the notification,Click Here
Inserted vide SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021 notification dated 05.05.2021. To view the notification, Click Here

SEBI (SAST) (Amendment) Regulations, 2020 dated 16.06.2020


SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2016, w.e.f. 17-02-2016


Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021 dated 05.05.2021


The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2018 dated 31.05.2018


SEBI Circular dated 15.02.2023 regarding introduction of Issue Summary Document (ISD) and dissemination of issue advertisements


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