This is to help Indian promoters hit by subdued stock market conditions then, and will allow them to revise prices as per the new pricing norms.
The government had in November 2008 relaxed the minimum pricing norms for conversion of FCCBs to the average of weekly high and low prices for two weeks prior to the relevant date instead of the earlier higher of the average for six months.
With the stock market falling sharply in 2008, the six-month norm had yielded high conversion prices. A finance ministry statement said: “In view of the problems being faced by companies, it has now been decided by the government to provide a window of six months under the scheme to interested companies to revise their conversion price as per new pricing norms.”
The move comes in the backdrop of several representations from companies seeking permission to revise the conversion price of FCCBs issued prior to November 27. The decision to extend this facility was taken in consultation with the RBI and market regulator Sebi.
Source: Economc Times Govt extends flexible pricing norm for conversion of FCCBs
Click On "Full Story" For More...
By ugesh sarkar, Section News
Posted on Mon Feb 15, 2010 at 08:55:29 PM EST
 |
However, the revision will be subject to the issuing company ensuring the revision of price and consequent issuance of shares not breaching the FDI limit. The issuing company shall also have to take approval from its board as well as shareholders and enter into a fresh agreement with the FCCB holders in terms of renegotiation of the conversion price.
Also, the company will be permitted to revise its conversion price only after the RBI’s approval, the statement added.
| < Irda Wants Sebi To Keep Off Ulips |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
