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The Securities Appellate Tribunal (SAT) has interpreted the special provisions for small companies in delisting regulations 2009 in favour of Trichy Distilleries and Chemicals Ltd and has directed the Madras Stock Exchange (MSE) to allow delisting of the equity shares of the company. The limited issue before SAT was whether the condition for delisting involved the consent of 90 per cent of the public shareholders in number or shareholders holding 90 per cent of the public shareholding in value, irrespective of their numbers.
On examination of the issue, SAT came to the finding that to avoid certain patent absurdities wherein a miniscule minority can hold up the process consented to by the majority, shareholders holding 90 per cent of the public shareholding in value irrespective of numbers can give consent to delist the company
Trichy Distilleries is a public limited company whose shares are listed on the MSE and not on any other exchange. With the advent of NSE, regional stock exchanges have become defunct. Therefore, the promoters decided to provide an exit route to public shareholders by getting the equity shares of the company delisted from MSE.
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