SAT's View On Inter-SE Promoter Transfers

SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 2011 ("Takeover Regulations") framed by the Securities and Exchange Board of India ('SEBI') provide that if any person (together with persons acting in concert with him) acquires voting rights or control in a target company in excess of the threshold limits stipulated under the regulations, he is required to provide an exit opportunity to other shareholders of the target company by making an open offer in accordance with the Takeover Regulations.  Regulation 10 of the Takeover Regulations however carve out certain exemptions from the obligation of making open offer under the regulations. One of such exemptions covered under Regulation 10 (1) (a) (ii) of the Takeover Regulations is the acquisition made pursuant to inter se transfer of shares amongst qualifying persons, that is those persons who have been named as 'promoters' in the shareholding pattern filed by the target company in terms of the listing