In a significant development, the Mumbai bench of the national company law tribunal (NCLT) on Wednesday approved ICICI Securities' delisting application, dismissing objections raised by Quantum Mutual Fund and minority shareholder Manu Rishi Gupta.
Under the approved scheme, ICICI Securities shareholders will receive 67 ICICI Bank shares for every 100 shares they hold, a ratio that had previously secured approval from 93.8% of ICICI Securities equity shareholders. The objectors, who collectively held a minuscule 0.082% stake, had alleged undue influence by ICICI Bank employees on the voting process, but their objections were ultimately dismissed by NCLT.
Separately, ICICI Securities disclosed in a BSE filing that it had paid a settlement amount of Rs69.82 lakh to the Securities and Exchange Board of India (SEBI) under the SEBI (Settlement Proceedings) Regulations, 2018. This settlement pertained to observations made by SEBI regarding the due diligence process followed by ICICI Securities in its merchant banking activities, and the company opted for settlement to avoid protracted proceedings arising from a show-cause notice (SCN) issued by the regulator.
While NCLT's Mumbai bench has approved the delisting, the saga continues to unfold in other legal venues. A similar case related to the delisting is currently being heard at the NCLT's Delhi bench, where allegations of ICICI Bank pressuring shareholders to support the delisting proposal are being examined.
Moreover, the Bombay High Court is addressing concerns raised by Aruna Vinod Modi, another ICICI Securities shareholder, who challenged SEBI's decision to grant ICICI Securities an exemption from the reverse book-building process required for delistings. The High Court has directed SEBI to disclose the exemption letter to Modi, albeit with strict conditions prohibiting her from sharing or reproducing the letter.
The ICICI Securities delisting saga has evolved into a multi-faceted legal battle, spanning various forums and raising critical questions about corporate governance, shareholder rights, and regulatory oversight. What began as objections from minority shareholders at NCLT has now expanded to encompass allegations of undue influence on the voting process, challenges to SEBI's exemption decisions and scrutiny of the due diligence processes followed by ICICI Securities in its merchant banking activities.
We have covered this delisting saga through various articles.
As the case progresses through the NCLT's Mumbai and Delhi benches, as well as the Bombay High Court, it continues to draw attention from investors, regulators, and the broader corporate community. The outcome of these proceedings could set significant precedents for future delisting processes, the interpretation of regulatory exemptions, and the balance between corporate strategies and minority shareholder rights in India's financial markets.
