tag:blogger.com,1999:blog-3202774368551476669.post2964525181760284456..comments2023-09-15T16:21:31.980+05:30Comments on INDIAN CORPORATE LAW: SEBI Reasserts Views on Put and Call OptionsUmakanth Varottilhttp://www.blogger.com/profile/12438677982004444359noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-3202774368551476669.post-47180332774742874582011-12-26T11:32:33.840+05:302011-12-26T11:32:33.840+05:30It is astonishing that when the market regulator S...It is astonishing that when the market regulator SEBI has asserted its view on specific Put & Call options as invalid, why the matter is debated and not taking its final shape? The corporate bigwigs with the help of legal experts are trying to twist SEBI's ruling in their own interest. However, it is certain that any decision that goes against SEBI's ruling would adversely impact the interest of small investors. This is a classic example of corporate influence in Indian Capital Market.sunil shethhttps://www.blogger.com/profile/03213951337425383809noreply@blogger.comtag:blogger.com,1999:blog-3202774368551476669.post-43087999982768143962011-08-24T13:18:25.908+05:302011-08-24T13:18:25.908+05:30ROFR & Put/Call options are misused by the cor...ROFR & Put/Call options are misused by the corporate worl, India in particular. The laws are twisted by the experts in favout of their clients for heavy fees. Such agreemnts should be allowed but with certain compulsory riders like; minimum price, transparent valuation method of stake in question. Any shareholder should have the power to rstrain the deal with necessary objections. Else, the matter is solved at the management level and the retail investors are deprived of eligible benefits.<br /><br />Cosidering the above probabilites, it would be advisable to consider such Put/Call options and ROFRs as void to avoid future litigations and injustice to small investors.sunil shethhttps://www.blogger.com/profile/03213951337425383809noreply@blogger.comtag:blogger.com,1999:blog-3202774368551476669.post-47992119017272804032011-06-22T07:36:50.297+05:302011-06-22T07:36:50.297+05:30Assuming the regulator is right on the put being v...Assuming the regulator is right on the put being violative of SCRA et al, how does that foreclose the consideration of key issue raised in the Informal guidance? ie. Whether the Italian PE player is a PAC with the existing shareholder of VEL. It seems unlikely though that as a matter of law, they would be PACs on the facts narrated. <br /><br />On a related note, if the SEBI continues with its ill-conceived view regarding put/call agreements, the investors will discount the investment at a higher rate to account for liquidity risk (as thats what a put option guarantees the investor at the back-end); discounting at a higher rate will reduce the pric at which equity (or other convertible) security will issue. That does not augur well for the issuers looking to attract foreign capital.Mandar Kagade.noreply@blogger.com