Vedanta delisting Procedure
1. The meeting for deciding the delisting process as per SEBI regulations will be held on 18.05.2020.
2. For the delisting of shares, a special resolution will be passed for shareholders’ approval.
3. Then voting will be done for approval or rejection of the delisting of Vedanta- However, delisting is bound to be successful as Vedanta promoters hold more than 50% share.
4. Once voting is successful, an offer letter will be dispatched to all shareholders containing the following details.
a) Floor price– a minimum price above which shareholders can place a bid. The shareholders can place a bid at any price above the floor price. The bids will be placed under the reverse book building process.
b) 7 days window will be opened for shareholders to bid.
Now how to decide the exit price
Let us understand it.
Discovered price – In the reverse book building, all the public shareholders will put their bids. The promoters will keep on acquiring shares and the price at which the shareholding of promoter’s group reaches 90% will be called as discovered price.
Now, promoters in their sole discretion may accept this price. Once they accept the discovered price, all the shareholders will be given an exit at discovered price and that price then finally be called Exit price.
So, in short, the delisting to be successful the promoters need 90% of total shares in the company.
Shareholding as on 31.03.2020.
1. Promoters- 50.14%
2. Public – 49.48%.
a) MF- 33.97%
b) Retail – 7.26%
c) HNIs- 0.28%
d) Foreign Investor- 15.15%.
As we discussed above, for this delisting to be successful the promoters need 90% of shares in their hand. If you see the shareholding carefully, ~33% of shares are held by MF and ~15% are in the hand of Foreign investors. So the onus to reject and accept this delisting is now on in the hands of MF and Foreign investors.
Will they accept Rs. 87, the answer is big No!!
So as an investor you should not be worried.