How could the amount deposited into Escrow Account distributed in the event of non-fulfilment of obligations under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations,

CS Professional · Corporate Restructuring, Valuation and Insolvency · PYQS · June 2021
How could the amount deposited into Escrow Account distributed in the event of non-fulfilment of obligations under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011?

Answer & Explanation:

In the event of forfeiture of amount, the entire amount is distributed in the following manner: one-third of the escrow amount to Target Company; one-third of the escrow account to the Investor Protection and Education Fund established under Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009; and one-third of the escrow account to be distributed pro-rata among the shareholders who have accepted the open Offer.

Topics: Takeovers

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