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February
2008
Auction
for sale (Re-issue) of ‘6.57
per cent Government Stock, 2011’ under Market Stabilization
Scheme’
The Discussion Paper on Public Holdings
Auction
for sale (Re-issue) of ‘6.57
per cent Government Stock, 2011’ under Market Stabilization
Scheme
Government
of India have announced the sale (re-issue) of "6.57 percent
Government Stock, 2011" under Market Stabilization Scheme for a
notified amount of Rs. 4,000 crore (nominal). The Government Stock
will be sold through price based auction using multiple
price method. The
auctions will be conducted by the Reserve Bank of India, Mumbai
Office, Fort, Mumbai on February
14, 2008(Thursday).
2.
Up to 5 per cent of the amount notified for the sale of stock
is reserved for allotment to eligible individuals and Institutions
on non- competitive basis as per the Scheme for Non-Competitive
Bidding Facility in the Auction of Government Securities.
3.
Bids in the prescribed form obtainable from the Regional
Director, Reserve Bank of India, Mumbai Office (Public Debt Office),
Fort, Mumbai-400 001 and RBI website www.rbi.org.in
should be submitted to that Office on February
14, 2008. The NDS members should submit competitive as
well as non-competitive bids in electronic format using Primary
Market Operation (PMO) module of NDS.
All bids should be submitted by 12.30 P.M.
4.
The result of the auctions will be announced on February
14, 2008and payment by successful bidders will be during
banking hours on February
15, 2008 (Friday).
Government
of India
Ministry of Finance
Department of Economic Affairs
New Delhi Dated February 8,
2008
The Discussion Paper on Public Holdings
A
large number of shares distributed among a large number of
shareholders is essential for the sustenance of a continuous market
for listed securities to provide liquidity to the investors and to
discover fair prices. The larger the number of shares and the number
of shareholders, i.e., the larger the public float, the less is the
scope for price manipulation. In order to ensure this, the
securities laws prescribe initial and continuous listing
requirements.
2.
Based on a review, it is proposed to amend
the Securities Contracts (Regulation) Rules, 1957 (SCRR) to provide
for both initial and continuous listing
requirements in the following manner:
(a)
The standards
for initial listing and continued listing may be prescribed in the
SCR
Rules.
(b)
The standards for initial and continuous listing may be
uniform, as the objective is
same.
(c)
The public offer envisaged at initial listing is of no
consequence unless the public
are actually allotted shares. The SCRR may speak in terms of
allotment to public, not just public offer.
(d)
As of now, the word ‘public’ is not defined. If
‘public’ means ‘non-promoters’ and includes FIs, FIIs, MFs,
employees, NRIs/OCBs, private corporate bodies, etc., the floating
stock would be insignificant. A view needs to be taken on this.
(e)
For a
company to be listed and continue to be listed, it must have a
public stake of 25%.
(f)
If for
any reason, the public holding reduces below 25%, the promoters,
management and company may be jointly and severally be liable to
bring the public holding to 25% within 3 months, in the manner
prescribed by SEBI, failing which appropriate enforcement action,
including delisting, may be taken.
(g)
There
should not be any discrimination between a Government company and
non-Government company. The powers of the stock exchange to relax
any of the conditions of listing with the prior approval of SEBI in
respect of a Government company needs to be withdrawn. Similarly,
the powers of SEBI to relax listing requirements may be withdrawn.
3.
A discussion paper titled, “Requirement
of Public Holding for Listing” containing above proposals has
been put up on the website of this Ministry. The comments on these
proposals are invited by 28th February, 2008 at shuvom2002@gmail.com.
___________________________________________________________________________
F.
No. 1/1/SM/ 2007
Dated 1st February, 2008
The
Press Information Bureau is requested to give wide publicity to this
Press release.
(M.
S. Sahoo)
Director (Securities Markets)
Press Information Officer
Press Information Bureau
Shastri Bhawan
New Delhi
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