SEBI Proposes Amendments to ICDR Norms to Streamline Offer-For-Sale Norms
SEBI has released a consultation paper proposing amendments to SEBI (Issue of Capital and Disclosure Requirements) Regulations for relaxing the offer for sale (OFS) norms. OFS is when the promoter is selling their holdings through a public issue. Currently, promoters are required to hold their shares for a minimum of one year before they do an OFS to the public. Only promoter holdings acquired following a scheme approved by judicial or governmental orders were exempt from this requirement.
SEBI has suggested that this exemption be extended even to equity shares that were acquired in the conversion of fully paid-up compulsorily convertible securities acquired following such a scheme (that was approved by judicial or governmental orders). This has been suggested because there has been some ambiguity around this and also because it would bring it in line with the minimum promoters' contribution (MPC) norms. Under current provisions, the holding period of all convertible securities is one year.
Public comments may be submitted by 10th April, 2025.
