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Q.

Delisting of companies ------is it a ploy of the promoters to grab the shares from the investors when conditions are favorable to them? Is there no law to protect the investors in such situations?

Asked by Good Citizen, 24 Nov '09 03:42 pm
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Answers (2)

1.

Delisting of shares from Indian stock exchanges has become a major issue for the financial regulator and the finance ministry to tackle. Almost every shareholder/investor has faced a scenario of having shares of a company that is seeking delisting from the stock exchange. This is either when a substantial acquisition of shares by acquirer (where the public holding dips below requisite levels) takes place and an exit offer made, or through mergers/ acquisitions or compulsory delisting enforced by the stock exchange. Investors also face the bane of being stuck with shares of a company that has not witnessed trading for years. The argument presented is that large, profit making and financially sound MNCs have delisted its shares from SEs in recent years and this has caused some concern. There is a perception within the financial markets that investors have not being adequately compensated for the permanent withdrawal of a good investment opportunity. But it must be noted t ...more
Answered by dharamender nebhnani, 24 Nov '09 08:33 pm

 
  
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2.

Its not that easy. There are company act /SEBI guide lines for such an act. Manipulating accounts or hiding facts are one thing and delisting or BIFR are different.
Answered by Subhas Mitra, 24 Nov '09 03:56 pm

 
  
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