Sebi rejects AGS Infotech plea seeking exemption for IPO

The Securities and Exchange Board of India (Sebi) has rejected the request from the Andhra Pradesh-based AGS Infotech to grant it an exemption from making an open offer in the case of transfer of stake from a group of co-promoters to a single co-promoter.

The co-promoters of AGS Infotech, listed on Hyedrabad Stock Exchange (HSE) C Rajshekhar Reddy, N Laxmi Narayana and Pankaj Maheshwari (co-promoters) wanted to sell their combined stake of 6.15 lakh fully paid-up equity shares and 5 lakh partly paid-up equity shares representing 28.59 per cent of voting rights of AGS Infotech company to D. Vishawagandha Raju (acquirer) who is also one of the promoters, holding 22.55 per cent of the voting capital of the company.

Sebi in its order issued last week rejected the application of the acquirer seeking exemption from making an open offer and directed that in case the acquirer proposes to proceed with the proposed acquisition, the same shall be done in strict compliance with regulations, which should follow with the public announcement and an offer to public shareholders. Raju made an application to Sebi seeking an exemption under section 4 of the Sebi Takeover Regulations.