Offer for Sale vs the Auction Route vs Promoters

Currencies strengthen against the rupee intra day despite expected range with RBI actions not making reform grade impact to rupee baiters

Offer for Sale is a possible route for promoters esp targeting those with more than 75% holding but also competes now with direct auctions Thoise choosing the OFS / IPP route can now however commit such sales every 2 weeks within the colling period of 12 weeks

Promoters are frequently charged with managing  the “market-making” in their scrips making votaries like India investor Advisory Services and Ingovern come up as a new segment of Proxy Advisory companies. Our home grown PACs may serve a long felt need but with limited individual experience in the ranks their impact may be as limited as of bloggers unfortunately

Promoters of Vedanta for example have used Sterlite and SESA GOA to consolidate Cairn and other indian resources in a single company structure buut Vedanta has palmed off loss making resources at a premium for over $500 M in cash profit onthe consolidation. Also the two indian stars are additionally handling VAL debt of $12 B. Here’s the amazing detail on the same

The Auction route allows promoters a lower prep time but Auctions of ONGC and WIPRO bombed soon after the announcement in January Seemingly the new thorny point will be not allowing modifications on OFS/Auction bids whence promoter is unable to gauge the degree of non interest in the issue

Sebi has also asked that an indicative price be displayed during the last 60 minutes of the close of bidding and stated that bids cannot be changed or cancelled during the last 60 minutes from the close of bidding session instead of last 30 minutes.

Any disclosure of a minimum price or floor price for the offer for sale would have to be made on the day before the offer, after close of business hours.(DNA – now under the Zee banner 🙂

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s