Mumbai: Indian market regulator SEBI has imposed a fine of Rs 25 crore on Reliance Industries owner Mukesh Ambani, his younger brother Anil Ambani and his wives Nita Ambani and Tina Ambani. Failure to follow this Pentale takeover rule has resulted in a fine of about 11 years old.
SEBI has fined many people in this case. These include Kokila sister Ambani, Mukesh Ambani’s son Akash Ambani, daughter Isha Ambani, Anil Ambani’s son Jai Anmol Ambani and others.
Sebi on Wednesday announced an order of 85 pages in the 20-year-old case. SEBI issued a show cause notice in the case in February 2011. Sebi said in its order that a penalty was imposed in 2000 by Reliance Industries for not following the takeover rules. At that time Reliance Industries was not divided. Anil Ambani and his wife Tina Ambani have also been fined.
Acquired 6.83% stake.
As per Sebi order, in 2000, the promoters of Reliance acquired 6.83 per cent stake in the company. The 30 million warrants issued in 1994 were converted and acquired. According to SEBI, the promoters of Reliance, together with PAC, acquired a 6.83 per cent stake, exercising the option of transferring shares related to non-transfer security redeemable debentures. The takeover was over the 5 percent limit set by the rule. In order to purchase the stake, they were required to publicly declare the acquisition of shares on 7 January 2000. Reliance’s equity shares were allotted to PAC on this date on the basis of warrants issued in 1994.
Of course, SEBI said that the promoter and PAC have not made any public announcement for the share acquisition. So they have violated the rules of acquisition. Under SEBI rules, if a promoter group acquires more than 5 percent voting rights in any financial year, it is necessary to bring an open motion to the shareholders. SEBI said the penalty is to be paid jointly and individually to the individuals and entities concerned.