The Securities and Exchange Board of India on Wednesday exempted the government from making an open offer to the shareholders of Dena Bank, following its plans to acquire an additional 5.66 per cent stake in the bank.

The Centre has proposed to acquire about 12.02 crore shares of Dena Bank through preferential allotment by the lender.

The bank had sought SEBI’s approval for the exemption on behalf of the government.

The exemption has been granted subject to the condition that the government or the bank would ensure compliance with the statements, disclosures and undertakings made with regard to the transactions, among others, SEBI said.

Currently, the Centre holds 62.89 per cent stake in the bank and post acquisition, its stake will rise to 68.55 per cent.

Takeover Regulation

According to SEBI norm, any increase of shareholding by 5 percentage points in the financial year will trigger a mandatory open offer from the buyer under the Takeover Regulation.

Exempting the Centre from open offer, SEBI said, “the proposed acquisition is necessitated on account of the GOI’s objective that all public sector banks are adequately capitalised for ensuring compliance with BASEL III norms.”

Besides, there will be no change in the number of equity shares held in the bank, by the public shareholders, pursuant to the proposed transactions, it added.

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