SEBI’s New Price Protection Regime – Is Deal Making Really Safeguarded?

SEBI’s New Price Protection Regime – Is Deal Making Really Safeguarded?

What?

SEBI’s 2023 consultation paper re: market rumour verification offered 2 price protections for public M&A: (A) insulate deal making from post-verification price fluctuations for 60-180 days; and (B) price protection only for 1 day after rumour verification
SEBI has now adopted (B), but also allowed the same protection on a rolling basis for multiple rumour verifications

Bottom Line?

Inadequate price protection for deal-making, esp. after forcing listed companies to verify rumours
Could significantly hurt retail and public shareholders, since well-cooked deals may fail due to premature rumour verification and attendant price spike/ fall

Only 24 hour time period to confirm market
rumours – compliance officers, directors,
promoters and KMP to gear up

Relevant Analysis

Public M&A: Does SEBI’s Market umour Proposal Offer the Much-Needed Price Protection?

Visit our website to view our analysis:

Public M&A: Does SEBI’s Market Rumour Proposal Offer the Much-Needed Price Protection?

Relevant Webinar

Visit our website to watch our webinar:

Public M&A – Dealmaking and Director Liabilities

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