MUMBAI: Reliance Industries (RIL) chairman Mukesh Ambani will file an appeal before the Securities Appellate Tribunal (SAT) against the penalty imposed by capital markets regulator Sebi over alleged takeover violations in a 21-year-old share issue in the company.
There has been no violation of Sebi’s takeover regulations and the promoters have complied with applicable laws, RIL said in a stock exchange filing. The promoters informed RIL that they will appeal to SAT and they remain confident of vindicating their position, RIL added in the filing.
Sebi had imposed a fine of Rs 25 crore collectively on multiple promoter entities including Ambani and his wife Nita for not complying with takeover norms in an RIL share issue that dates back to 2000. The promoter entities had raised their stake in RIL by 6.8% by subscribing to its equity shares.
According to Sebi, rules require promoter entities to make an open offer to minority investors if they acquire more than 5% in the company. RIL said that it had issued debentures with convertible warrants in 1994 and allotted equity shares against the warrants in 2000.
“Sebi had issued a show-cause notice in February 2011 (more than 11 years after acquisition of shares) to the then promoter group (as in the year 2000) alleging violation of its takeover regulations,” RIL’s statement read.
In the event the promoter entities fail to pay the fine within 45 days of the receipt of the Sebi order, the regulator had said that it would initiate actions to recover the amount along with interest by attachment and sale of movable and immovable properties.