The Securities Appellate Tribunal (SAT) has allowed PNB Housing Finance to go ahead with the voting to obtain approval of its shareholders for the proposed ₹4,000-crore stake sale to a clutch of investors, led by Carlyle Group. The tribunal has, however, directed the housing finance company not to disclose the outcome of the voting until further orders.

PNBHF had filed an appeal in SAT against an order passed by SEBI on Saturday. The regulator had asked the housing finance company not to go ahead with the stake sale until the company undertakes an independent valuation of its shares. SEBI had said the notice given by PNBHF on May 31 for Extraordinary General Meeting to approve the stake sale is “ultra-vires of Article of Association (AoA) and shall not be acted upon until the company undertakes the valuation of shares.”

Now, with the SAT giving its interim ruling, PNBHF can go ahead with its scheduled EGM on Tuesday. But SAT has also directed the company to inform NSDL also to not declare the voting pattern and keep the same in a sealed cover till further orders.

The proposed stake sale had hit a bump after Stakeholders Empowerment Services, a governance watchdog, expressed concern over the deal, wherein PNBHF would preferentially allot ₹3,200 crore worth of shares and ₹800 crore worth of warrants to a bunch of investors, including Carlyle, former HDFC Bank chief executive officer Aditya Puri’s family investment vehicle, General Atlantic, and Alpha Investments at ₹390 apiece. SES, in a report issued in the first week of June, termed the deal as being “unfair” to public shareholders because “The company wants investors to believe that even with book value per share of about ₹530, the proposed issue price is fair”.

PNBHF, on the other hand, said it calculated the floor price as prescribed by SEBI and the issue price of ₹390 per share is above the floor price of ₹384.6 per share. PNB Housing has argued that under Rule 13 of the Companies (Share Capital and Debentures) Rules, 2014 the requirement of getting a valuation done through a registered valuer has been dispensed with when the preferential allotment of shares is being issued by a listed company.

SAT hearing on July 5

SAT will continue hearing the case on July 5 to decide whether an independent valuation, as ordered by SEBI, is required to be done or not. SAT has directed SEBI to file a reply by June 26 and rejoinder, if any, by July 4.

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