Markets regulator Securities Exchange Board of India SEBI has asked an individual to disgorge Rs 4.9 crore latest by January 31 for failing to comply with takeover regulations in the matter of Orient Tradelink Ltd
Since, from August 1, 2019 the amount paid with 10 percent interest. SEBI in March 2008 issued a show cause notice against Aushim Khetarpal for allegedly indulging in market manipulation and creation of artificial volume in the scrip of Orient Tradelink Ltd.
Investigation of Orient Tradelink Ltd
At the time of investigation the officials failed to comply with the mandatory requirement of making public announcement. It was related to the takeover regulations.
SEBI asked Khetarpal to offer for the acquisition of shares in the matter of Orient Tradelink Ltd.
Additionally, the open offer made by the acquirer had opened on July 5, 2019 and closed on July 18, 2019 for acquisition of over 1 crore equity shares representing 20 per cent of the total voting stock market of the firm.
“As per information received by SEBI from the BSE, 1,09,65,000 equity shares were tendered in the open offer i.e 100 per cent acceptance and accordingly, the total maximum consideration payable under the open offer amounted to Rs 5,04,39,000,” Sebi said.
Besides, it noted that Khetarpal had opened and escrow account with ICICI Bank wherein it deposited Rs 14 lakh. In addition, he had pledged 17.3 lakh equity shares of Orient Tradelink amounting to over Rs 1.1 crore with merchant banker Fast Track Finsec as security towards the obligation under the open offer.
However SEBI noticed there is a shortfall in the escrow account. Hence, it was 25 percent for open offer consideration.
According to the instant proceedings, acquirer failed to ensure payment of consideration to all the shareholders. It tendered the shares under open offer.
Accordingly, Kharatpal asked to disgorge the balance amount of Rs. 4.9 crore. It applied simple interest of 10 percent.
Final Word regarding Orient Tradelink Ltd Case
The Investor Protection and Education Fund received the disgorged amount. the investors of the firm utilized reinstitution. It tendered the shares in acceptance of open offer.
In the Escrow account Rs.14 Lakhs deposited. It utilised for the payment of consideration for the investors of Orient Tradelink Ltd.
Peers Allied Corporation Ltd and 11 directors levied for the fine of Rs.25 Lakhs. It operated unregistered collective investment schemes.
