N O T I C E
Dated : 28th June
2018
Trading Members are hereby informed that the Exchange
has received a Circular from SEBI Vide Ref. No. SEBI/HO/DDHS/DDHS/CIR/P/2018/89,
Dated June 05, 2018 regarding Guidelines
for Preferential Issue of Units by Infrastructure Investment Trusts (InvITs).The contents of the said circular are
reproduced hereunder for information of trading members.
Quote
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CIRCULAR
SEBI/HO/DDHS/DDHS/CIR/P/2018/89 June
05, 2018
To,
All Infrastructure
Investment Trusts (InvITs)
All Parties to InvITs
All Stock Exchanges (other
than Commodity Exchanges)
All Merchant Bankers
Dear Sir/ Madam,
Sub: Guidelines for Preferential
Issue of Units by Infrastructure Investment Trusts (InvITs)
1. Regulation 2(1)(zo) of
SEBI (Infrastructure Investment Trusts) Regulations, 2014 (“InvIT
Regulations”) defines a preferential issue. Regulation 14(4)(b)
read with Regulation 2(1)(zo) provides for any subsequent issue of units after
an initial offer in a manner specified by Board from time to time. Accordingly,
the detailed guidelines for preferential issue by an InvIT
are provided herein.
2. Conditions for preferential
issue
2.1. A listed InvIT may make
preferential issue of units to an institutional investor as defined in the InvIT regulations, if it satisfies the following conditions:
2.1.1. A resolution of the unitholders of the InvIT approving the preferential issue in accordance with
Regulation 22(5) of the InvIT Regulations has been
passed.
2.1.2. The InvIT is in
compliance with the conditions for continuous listing and disclosure
obligations under the InvIT Regulations and circulars
issued thereunder.
2.1.3. The InvIT is in
compliance with the minimum public unitholding requirements as stipulated under
Regulation 16 (6) of the InvIT Regulations.
2.1.4. No preferential issue of units by the InvIT has been made in the six months preceding the
relevant date.
2.2. Preferential issue pursuant to the unitholders
resolution referred to in Clause 2.1.1 shall be completed within a period of
twelve months from the date of passing of the resolution.
2.3. Allotment pursuant to preferential issue shall be
completed within 12 days.
2.4. The units shall be issued only in dematerialized
form.
2.5. The units to be issued in preferential issue
shall be of same class or kind as the units issued in the initial offer by the InvIT.
Further, such
units have been listed on a recognised stock
exchange, having nationwide trading terminal for a period of at least six
months prior to the date of issuance of notice to its unitholders for convening
the meeting to approve the preferential issue.
2.6. The minimum subscription and trading lot for the
units to be issued in preferential issue shall be same as that for units issued
in the initial offer by the InvIT.
2.7. The units in a preferential issue shall be
offered and allotted to a minimum of two investors and maximum of 1000
investors in a financial year.
2.8. Relevant date for the purpose of preferential
issue shall mean the date of the meeting in which the board of directors of the
investment manager of the InvIT or the committee of
directors duly authorised by the board of directors
of the investment manager of the InvIT decides to
open the proposed issue.
3. Placement Document
3.1. The InvIT may appoint
one or more SEBI registered intermediaries to carry out the obligations
relating to the issue.
3.2. The preferential issue of units by an InvIT shall be done on the basis of a placement document,
which shall contain disclosures as specified in Annexure I.
3.3. The placement document shall be serially numbered
and copies shall be circulated only to select investors subject to compliance
with clause 2.7 above.
3.4. The InvIT shall, while
seeking in-principle approval from the recognised
stock exchange, furnish a copy of the placement document, a certificate issued
by its merchant banker or statutory auditor confirming compliance with the
provisions of these Guidelines along with any other documents required by the
stock exchange.
3.5. The placement document shall also be placed on
the website of the concerned stock exchange and the InvIT
with a disclaimer to the effect that it is in connection with a preferential
issue and that no offer is being made to the public or to any 0other investor.
4. Pricing
4.1. The preferential issue shall be made at a price
not less than the average of the weekly high and low of the closing prices of
the units quoted on the stock exchange during the two weeks preceding the
relevant date.
Explanation: For the purpose of
this clause, the term “stock exchange” means any of the recognised
stock exchanges on which the units of the InvIT are
listed and
on which the highest
trading volume in such units has been recorded during the two weeks immediately
preceding the relevant date.
4.2. The InvIT shall not
allot partly paid-up units.
4.3. The prices determined for preferential issue
shall be subject to appropriate adjustments, if the InvIT:
4.3.1. makes a rights issue
of units
4.3.2. is involved in such
other similar events or circumstances, which in the opinion of the concerned
stock exchange, requires adjustments.
5. Restriction on allotment
5.1. No allotment shall be made, either directly or
indirectly, to any party to the InvIT or their
related parties except to the sponsor only to the extent that is required to
ensure compliance with regulation 12 (3) of the InvIT
Regulations.
Explanation: To determine the
“related parties”, the term related party as defined under the InvIT Regulations shall be applicable. However, Mutual
Funds, Insurance Companies and Pension Funds shall not be treated as related
parties for the purpose of clause 5.1 above.
5.2. The applicants in preferential issue shall not
withdraw their bids after the closure of the issue.
6. Transferability of Units
6.1. The units allotted under preferential issue shall
not be sold by the allottee for a period of one year
from the date of allotment, except on a recognised
stock exchange.
7. This circular is being issued in exercise of powers
conferred under Section 11(1) of the Securities and Exchange Board of India
Act, 1992, Regulation 33 of the InvIT Regulations.
8. This Circular is available on the website of the
Securities and Exchange Board of India (“SEBI”) at www.sebi.gov.in under the category “Legal” and under the
drop down “Circulars”.
Yours faithfully,
Barnali Mukherjee
Chief General Manager
Department of Debt and
Hybrid Securities
Tel. No.: +91 22 2644 9660 ,E-mail ID: barnalim@sebi.gov.in
Unquote: -
Trading Members are requested to take note of the
aforesaid guidelines of SEBI and act accordingly.
Dhiraj
Chakraborty
Deputy
General Manager
ANNEXURE
I
Information to be included in the
placement document:
1) Disclaimer to the effect that the Placement
Document relates to an issue made to institutional investors under the InvIT Regulations and these Guidelines and that no issue is
being made to the public or any other class of investors.
2) Market Price Information: Disclose particulars of:
a) high, low and average
market prices of units of the InvIT during the
preceding three years or since the date of listing until the date of the
placement document, as applicable;
b) monthly high and low
prices for the six months preceding the date of filing of the placement
document;
c) number of units traded on
the days when high and low prices were recorded in the relevant stock exchange
during period of (i) and (ii) above, and total volume
traded on those dates;
d) the stock market data
referred to above shall be shown separately for periods marked by a change in
capital structure, with such period commencing from the date the concerned
stock exchange recognizes the change in the capital structure
e) the market price
immediately after the date on which the resolution of the board of directors of
the investment manager or manager of the InvIT
approving the issue was approved.
f) the volume of units traded
in each month during the six months preceding the date on which the placement
document is filed with the stock exchanges and the Board;
g) along with high, low and
average prices of units of the InvIT, details
relating to volume of business transacted should also be stated for respective
periods.
3) The placement document shall contain the
disclosures as specified under schedule III of the InvIT
Regulations in the following manner:
a) The disclosures as per clauses 1, 2, 3, 5, 6, 7(a),
8, 12, 13, 14, 15, 16, 17 and 19 shall be made in the placement document.
b) The disclosures in clause (a) above may be
incorporated by reference to disclosures made in any previous offer document or
placement memorandum or placement document.
Provided, the link(s) to such document wherever
available, including on the website of the InvIT,
stock exchanges or SEBI, shall also be provided. Provided further, any
modification/update in the information provided in such documents shall be
suitably incorporated in the placement document.
4) Terms of the issue:
a) Objects of the issue
b) If the objects of the issue involve financing of
any new asset(s), description of such asset(s) as per disclosures required
under clause 6 of the Schedule III of the InvIT
Regulations.
c) If the objects are not being financed solely
through the issue proceeds, the details of other financing arrangements for
fulfilling the objects of the issue.
5) Related Party Transactions:
a) Disclosure as per clause 9 of the Schedule III of
the InvIT Regulations, which may be incorporated by
reference to disclosures made in any previous offer document or placement
memorandum or placement document.
b) Any disclosures made regarding related party
transactions shall also be incorporated by reference to such disclosures.
c) Link(s) to document(s) at (a) and (b) above
wherever available, including on the website of the InvIT,
stock exchanges, shall be provided.
6) Valuation
a) Summary of valuation of the assets proposed to be
financed through proceeds of the issue, if any, as per the latest valuation
report not more than six months old from the relevant date.
b) Valuation methodology
c) Frequency of valuation and declaration of NAV.
d) Any disclosures made regarding valuation since the
initial offer shall also be incorporated by reference to such disclosures.
e) Link(s) to document(s) at (d) above wherever
available, including on the website of the InvIT,
stock exchanges, shall be provided.
f) The valuation report of the asset to be financed
through proceeds of the issue, if any, shall be provided along with the
placement document.
7) Financials
a) Disclosure as per clause 11 of the Schedule III of
the InvIT Regulations
b) Disclosure as per clause (a) above may be
incorporated by reference to any public disclosures of financials made under
the InvIT Regulations or any circular issued
thereunder, along with link(s) to such disclosure(s) wherever available,
including on the website of the InvIT, stock exchanges.
Provided, the information contained therein is not more than six months old
from the relevant date.
8) Distribution including the manner of calculation of
the net distributable cash flows, history of distributions made in the last
three financial years or from the date of listing of the InvIT
and the policy, if any.
9) Other disclosures:
a) Unit holding pattern
b) Review of Credit Rating
c) Grievance redressal mechanism
d) The disclosures in clause (a), (b) and (c) above
may be incorporated by reference to any public disclosures made under the InvIT Regulations or any circular issued thereunder, along
with link(s) to such disclosure(s) wherever available, including on the website
of the InvIT, stock exchanges.