IFL Group stocks surge in trade
Nirmal Jain clarifies to ET Now
IIFL Finance in focus
In an overnight development, IIFL Finance uploaded a notification where it was apparent that the promoter group entity had purchased shares from the open market. In the process, the notification mentioned that the promoter's shareholding in the company had crossed above 25%. The overnight filing indicated that promoter Nirmal Jain purchased an additional 0.12% stake on June 24, 2020.
Post this development as SEBI rules clearly mandate that an open offer be triggered if promoter stake crosses 25%, IIFL Finance was perched at the upper circuit limit of 10% in intraday trade. ET NOW spoke to various corporate lawyers who too mentioned that there was no ambiguity with regards to the SEBI rule. In fact, a leading lawyer on the condition of anonymity mentioned that "Breaching 25% shareholding limit in a company will trigger an open offer. No Relaxations have been granted with regards to this rule".
Post the development IIFL Finance sent out two fresh notifications. The first notification verbatim read as follows
This is to clarify that the Promoter Group’s voting rights in the Company has not exceeded 25% and Promoter Group has no intent to acquire more than 25% voting rights in the Company or make any public offer.
Kindly take the same on record and oblige.
For IIFL Finance Limited"
Post this clarification, IIFL gave another clarification stating that the letter was actually a miscommunication and that the promoter shareholding never went above the 25% threshold. In fact, Nirmal Jain spoke exclusively to ET NOW and mentioned that there is no intention of an open offer getting triggered.
He also said, "There was a technical error in the filing yesterday, have not crossed 25% holding in IIFL Finance."
Promoter group entities together combined hold a 24.99% in IIFL Finance. JN Gupta, Founder & MD, Stakeholders Empowerment Services & Former ED, SEBI also joined ET NOW and said it appears most likely to have been a miscommunication.
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