Sebi has Denied Permission for its Rs 9,000 Crore Share Buyback Offer.

L&T had planned to buy back up to 6.1 crore shares from shareholders at a price of Rs 1,475 per equity share, aggregate to Rs 9,000 crore. The offer was open to those holding equity shares as on October 15.
Sebi has Denied Permission for its Rs 9,000 Crore Share Buyback Offer.

The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India. It was established in 1988 and given statutory powers on 30 January 1992 through the SEBI Act, 1992.

Securities and Exchange Board of India (SEBI) was first established in the year 1988 AQF as a non-statutory body for regulating the securities market. It became an autonomous body by The Government of India on 12 May 1992 and given statutory powers in 1992 with SEBI Act 1992 being passed by the Indian Parliament. SEBI has its headquarters at the business district of Bandra Kurla Complex in Mumbai and has Northern, Eastern, Southern and Western Regional Offices in New DelhiKolkataChennai, and Ahmedabad respectively. It has opened local offices at Jaipur and Bangalore and is planning to open offices at GuwahatiBhubaneshwarPatnaKochi and Chandigarh in Financial Year 2013 – 2014.

A controller of Capital Issues was the regulatory authority before SEBI came into existence; it derived authority from the Capital Issues (Control) Act, 1947.

Initially, SEBI was a nonstatutory body without any statutory power. However, in 1992, the SEBI was given additional statutory power by the Government of India through an amendment to the Securities and Exchange Board of India Act, 1992. In April 1988 the SEBI was constituted as the regulator of capital markets in India under a resolution of the Government of India. The SEBI is managed by its members, which consists of the following:

The chairman who is nominated by Union Government of India.Two members, i.e., Officers from Union Finance Ministry. One member of the Reserve Bank of India. The remaining five members are nominated by Union Government of India, out of them at least three shall be whole-time members.

After amendment of 1999, collective investment scheme brought under SEBI except for NIDHI, chit fund, and cooperatives.

Engineering major Larsen & Toubro (L&T) on Saturday said market controller Sebi has deprived of permission for its Rs 9,000 crore share buyback offer.

Sebi twisted down the buyback offer since the ratio of the collective of secured and unsecured debts owed by the company after buy-back would be over twice L&T's paid-up capital and gratis reserves.

In a narrow filing to stock exchanges, L&T said the Securities and Exchange Board of India (Sebi) has asked it not to continue with the buyback.

"Since the ratio of the aggregate of secured and unsecured debts owed by the company after buy-back (assuming full acceptance) would be more than twice the paid-up capital and free treasury of the company based on consolidate financial statements", the buyback offer is not in fulfillment with the Companies Act and Sebi norms, the regulator said in a letter to the company.

L&T had planned to buy back up to 6.1 crore shares from shareholders at a price of Rs 1,475 per equity share, aggregating to Rs 9,000 crore. The offer was open to those holding equity shares as on October 15.

A buyback reduces the number of shares available in the open market.

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