Mumbai: Racing to meet Sebi's deadline to achieve minimum 25 percent public shareholding by June, offer for sale (OFS) issues -- worth Rs 75 crore -- of four firms, including Modern India, sailed through Friday.
ELCID Investments' offer for sale of 9,500 scrips got bids for 11,900 shares, translating into 1.25 times subscription.
The OFS of Fomento Resorts got bids for 46,90,955 shares against an offer of 32,68,500, while Modern India's 41,86,113 share sale was subscribed 100 percent.
Similarly, Sharda Motor Industries saw bids for 3,23,645 shares for the 2,85,000 shares on offer.
All listed private sector companies need to achieve 25 percent minimum public shareholding by June 3, Monday, to avoid penal actions by the regulator Sebi.
Yesterday, nine companies including Jet Airways and Tata Teleservices (M) hit the markets with their respective OFS issues, worth nearly Rs 900 crore to achieve minimum public shareholding.
Nearly 30 companies are yet to lower their promoter holdings to 75 percent or below to comply with the guidelines and together these firms would need to sell shares worth over Rs 5,000 crore. While at least five of them have already announced share sales for Monday, the others would need to make announcements in this regard over the weekend.
SEBI has allowed them to make an announcement for such sale of shares through OFS route just one day in advance, as against earlier requirement of giving a notice at least one trading day in advance. This will help the companies make the announcements over the weekend as well.
In May so far, 63 companies have hit the market with their respective OFS issues, while, many companies are expected to follow suit as market regulator Sebi's deadline is fast approaching.
For public sector companies, minimum public shareholding has been fixed at 10 percent and the deadline is till August 8, 2013. These norms were announced in June 2010 to ensure that the public investors get a larger presence and help create an equity culture in the country.
To help companies comply with the new public shareholding norms, Sebi in 2012 created two new routes -- offer for sale (OFS) and institutional placement programme (IPP). Sebi also allowed companies to use rights and bonus issue routes to enhance public holding.
First Published: Friday, May 31, 2013, 13:43