Regulation 37 - Delisting of equity shares of a subsidiary company pursuant to a scheme of arrangement - Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021.

Part - C SPECIAL PROVISIONS FOR A SUBSIDIARY COMPANY GETTING DELISTED THROUGH A SCHEME OF ARRANGEMENT WHEREIN THE LISTED HOLDING COMPANY AND THE SUBSIDIARY COMPANY ARE IN THE SAME LINE OF BUSINESS Delisting of equity shares of a subsidiary company pursuant to a scheme of arrangement 37 . (1) Nothing contained in these regulations shall apply to the delisting of equity shares of a subsidiary company, pursuant to a scheme of arrangement by an order of a Court or Tribunal with its listed holding company, whose equity shares are frequently traded, and where the listed holding company and the subsidiary company are in the same line of business. (2) The delisting of the equity shares of a subsidiary company in terms of sub-regulation (1) shall be permitted subject to the following:- a) the listed holding company shall provide for the issue of its equity shares in lieu of cancellation of any equity shares in the delisting subsidiary company; b) upon such delisting becoming effective, the subsidiary company shall become a wholly owned subsidiary of the listed holding company; c) compliance with regulations 11 , 37 and 94 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Circulars issued thereunder; d) e-voting from shareholders of both listed companies wherein votes cast by public shareholders of the listed subsidiary in favour of the proposal are at least two times the number of votes cast against it and the votes cast by the public shareholders of the listed holding company in favour of the proposal are more than the number of votes cast by the public shareholders against it; e) the shares of the listed holding company and the subsidiary company are listed for at least 3 years and shall not be suspended at the time of taking this route; f) the subsidiary company has been a listed subsidiary of the listed holding company for the past three years; g) no adverse orders have been passed by the Board in the past 3 years against the listed holding company and the listed subsidiary company; h) no further restructuring shall be undertaken by the listed holding company for a period of 3 years from the date of the Order of the Court or Tribunal approving the scheme of arrangement; i) the equity shares of the listed subsidiary so delisted, shall not be allowed to seek relisting for a period of three years from the date of delisting and such relisting shall be in terms of sub-regulation (3) and (4) of regulation 40 of these regulations; and, j) the valuation of shares of the listed subsidiary per share shall not be less than sixty days volume weighted average price. 1 [Explanation The reference date for computing the volume weighted average price would be the date on which the prior intimation is required to be given to the stock exchanges under regulation 29 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time. ] *************** NOTES:- 1. Substituted vide Notification No. SEBI/LAD-NRO/GN/2024/206 dated 25-09-2024 w.e.f. (For Additional Condition See this Notification ) before it was read as, Explanation,- The reference date for computing the volume weighted average price would be the date on which the recognized stock exchange(s) was required to be notified of the board meeting in which the delisting proposal of the subsidiary was considered and approved.