Introduction
Under the Securities Exchange Board of India (Substantial
Acquisition of Shares and Takeovers) Regulations, 19971
("Takeover Code"), if an acquirer
proposes to acquire 15% or more of the voting rights in a target
company, it is required to make an open offer. Under the open
offer, the acquirer must make a public announcement to the
shareholders of the target company to acquire at least 20% of the
voting capital of the company. This gives an opportunity to the
shareholders to exercise a choice to either off-load their shares
at a price as determined in accordance with the Takeover Code or to
continue as shareholders. However, the question is, if a public
offer, once made, can it be allowed to be withdrawn? Going by the
view of the Supreme Court of India
("SC") in Nirma Industries Ltd. and
Anr vs Securities & Exchange Board of India, decided on
May 09, 2013, it appears that it cannot be withdrawn.
