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It was an open offer clearance that was not to be.
The stock market regulator SEBI inadvertently uploaded on its Web site at 4 p.m. on Monday, that it had issued final observations and cleared Vedanta's open offer in Cairn India worth Rs 13,610 crore (for up to 51 per cent stake in Cairn India), which was picked up immediately by wire agencies.
The news was short-lived when the regulator reverted to its original status by 5 p.m.. When contacted, SEBI officials confirmed that it was a mistake on their part and the status is still under process.
An open offer works as follows: Companies have to make a public announcement (PA) within four days of the offer being triggered. The draft letter of offer and due diligence is then filed by the acquirer (in this case Vedanta) to SEBI not later than14 days from the PA.
SEBI is then expected to provide its comments and observations within 21 days. On receipt of final observations, the acquirer has to send a letter of offer to all shareholders within 45 days of the PA.
The open offer begins after 10 days thereafter and remains open for 20 more days. The acquirer has to complete the formalities including the payment of consideration within the next 15 days making the total process a 90-day affair.
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