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Sebi proposes tighter relisting norms for CIRP companies

Sebi proposes tighter relisting norms for CIRP companies

The 8,764 per cent rise in the share price of Ruchi Soya Industries, after the Corporate Insolvency Resolution Process (CIRP), has prompted Sebi to propose stringent relisting guidelines. In a discussion paper, Sebi has proposed three options for CIRP companies to increase public float at quicker timelines.

Under option 1, post-CIRP, companies should be mandated to achieve at least 10 per cent public shareholding within six months and 25 per cent within 3 years from the date of breach of minimum public shareholding norm. The second option proposes post-CIRP, firms should be mandated to have at least 5 per cent public shareholding at time of relisting. Such firms may be given 12 months to achieve public shareholding of 10 per cent and further 24 months to achieve public shareholding of 25 per cent.

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