A listed company can apply to stock exchange for re-classification of the Promoter's holdings as public shareholders under SEBI regulations. Whether the following promoters can apply for re-classification, with reference

CS Professional · Corporate Funding & Listings in Stock Exchanges · PYQS · June 2022
A listed company can apply to stock exchange for re-classification of the Promoter's holdings as public shareholders under SEBI regulations. Whether the following promoters can apply for re-classification, with reference to SEBI Regulations, 2015?(i) Promoter is declared as fugitive economic offender.(ii) Promoter is holding 18% of total voting rights in the listed entity.(iii) Promoter is acting as Chief Financial Officer of the listed entity.(iv) The promoter company has outstanding listing fees only for one year.(v) Trading of its shares suspended by the stock exchanges.

Answer & Explanation:

The promoter(s) seeking re-classification and persons related to the promoter(s) seeking re-classification shall not be a fugitive economic offender. The promoter(s) seeking re-classification and persons related to the promoter(s) seeking re-classification shall not together, hold more than 10% of the total voting rights in the listed entity. The promoter(s) seeking re-classification and persons related to the promoter(s) seeking re-classification shall not act as a key managerial person in the listed entity. The listed entity shall not have any outstanding dues to the stock exchanges. The listed entity shall not have trading in its shares suspended by the stock exchange. The Promoters cannot apply for re-classification as none of the above conditions are satisfied as per SEBI (LODR) Regulations, 2015.

Topics: Promoters

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