Lok Sabha Question No. 235 (UNSTARRED), answered on 2017-02-03
Subject: Exclusively Listed Companies
Ministry: FINANCE
Asked by: A. ARUNMOZHITHEVAN

## GOVERNMENT OF lNDlA MINISTRY OF FrNANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOKSABHA UNSTARRED QUESTION NO. 235 TO BE ANSWERED ON FRIDAY, 3 rd FEBRUARY, 20171 MAGHA 14,1938 (Saka)

## ~~XCLUSIVELV LISTED COMl)ANlE ..

## QUESTION

## 235. SHRI A. ARUNMOZHITHEVAN:

Will the Minister of FINANCE be pleased to state:

- (a) whether the Securities and Exchange Board of India (SEBI) has asked Exclusively Listed Companies (ELCs) to get listed on the nationwide stock exchanges within 18 months, if so, the details thereof;
- (b) whether the SEBl has allowed such companies to raise capital through preferential allotment route to meet listing requirements to safeguard investors of firm listed on non-operat onal bourses;
- Cc) ifso, the details thereof;
- (d) whether the ELCs which fail to list on the nationwide stock exchanges under the mechanism would provide exit opportunity to its investors; and
- (e) if so, the details thereof?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI ARJUN RAM MEGHWAL)

(a): Yes Madam. The Securities and Exchange Board of India (SEBf) has informed that in the interest of investors of the exclusively listed companies ofdt-recog.lizedl non-operational stock exchanges, SEB!, vide its Circular dated J 7th April, 2015, decided to allow such exclusively listed companies a timeline of 18 months to obtain listing on any nationwide stock exchange upon compliance with the listing requirements.

(b) and (c): Yes Madam. In order to fulfill the listing requirements of the nationwide stock exchanges, SEBl, vide its Circular dated loth October, 2016, permitted tile exclusively listed companies of de-recognized/ nonoperational stock exchanges to raise capital through preferential allotment rou e in terms of provisions under the Issue of Capital and Disclosure Requirements Regulations, 2009 (ICDR Regulations).

(d) and (e): Yes Madam. SEBI, vide its Circular dated lOthOctober, 2016, has mandated that those exclusively listed companies which al'e linable to list 011 nationwide stock exchanges under the mechanism provided therein shall provide an exit opportunity to their investors in accordance with the procedure prescribed in the said Circular. For this purpose, the promoter of the exclusively listed cornpan / shall, in consultation with the designated stock exchange, appoint an independent valuer from the panel of expert valuers of the designated stock exchange. If the fair val ue so determi ned is positi ve, the promoter shall make payment of consideration to the public shareholders. Further, the promoter is required to acquire the shares of the shareholders who have not offered their shares under the exit offer Lipto a period of one year from the c mpletion of the offer at the same price determined by the valuer. The Circular also states that the designated stock exchange shall remove the company from the Dissemination Board after the promoters certify to the satisfaction of the designated stock exchange that appropriate procedure has been followed for providing exit to the shareholders.

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