Sebi exempts family trust related to Suprajit Engineering from making open offer

Markets regulator Sebi Thursday exempted a private family trust related to the promoter group of Suprajit Engineering from the obligation of making an open offer following its proposed acquisition of 38 per cent stake in the firm. Supriyajith Family Trust had sought exemption from the obligation of making open offer post-acquisition of over 5.31 crore shares in Suprajit Engineering, a leading automotive supplier.

Under the proposed acquisition, the trust would be acquiring 38 per cent shares of the firm from its promoters Ajith Kumar Rai and Supriya Ajith Rai, who are also trustees of the Supriyajith Family Trust. The proposal has been made following a private family arrangement to provide for family succession and to ensure a seamless transition in the future.

In an order, Sebi granted exemption to the Trust from making the open offer, saying the proposed acquisition would take place pursuant to a private family arrangement intended for succession of the family trust. Besides, the proposed acquisition will not affect the interest of the public shareholders and there will be no change in control of the company pursuant to the proposed acquisition, noted Sebi.

According to the SAST (Substantial Acquisition of Shares and Takeovers) Regulations, an entity buying 25 per cent stake in a listed firm will have to mandatorily make an open offer to buy an additional 26 per cent shares from the public shareholders. While providing the exemption with certain conditions, the watchdog said the proposed acquisition should be in accordance with the relevant provisions of the Companies Act and other applicable laws.

Subsequently, the Trust is required to file a report with the Securities and Exchange Board of India (Sebi) within 21 days.

(With inputs from agencies.)