Description

SEBI adjudication order imposing penalties on Nilesh Malshi Savla and Meena Nilesh Savla for violations of SAST Regulations in acquisition of RKD Agri & Retail Limited shares.

Summary

SEBI issued an adjudication order against Nilesh Malshi Savla and Meena Nilesh Savla for violations of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 in connection with their acquisition of equity shares in RKD Agri & Retail Limited. The violations relate to failure to comply with disclosure and open offer requirements following a preferential warrant issue.

Key Points

  • Adjudication proceedings initiated against two noticees for SAST Regulations violations
  • Violations include breaches of Regulation 3(1), 3(2), 3(3), 28(2), 29(2) and 29(3) of SAST Regulations
  • Case involves acquisition of equity shares through preferential warrant issue in RKD Agri & Retail Limited
  • Board approved issue of 5,42,00,000 warrants (3,81,25,000 to promoters/acquirers and 1,60,75,000 to public)
  • EGM held on January 25, 2023 approved preferential issue at ₹1 per warrant
  • Show Cause Notice issued on February 24, 2025

Regulatory Changes

No new regulatory changes introduced. This is an enforcement action for existing SAST Regulations violations.

Compliance Requirements

  • Entities acquiring substantial stakes must comply with disclosure requirements under Regulation 3 of SAST Regulations
  • Acquirers must make mandatory open offers when crossing specified thresholds
  • Proper compliance with timelines and procedures for open offers as specified in Regulation 28 and 29

Important Dates

  • December 21, 2022: Board meeting approving warrant issue
  • January 25, 2023: EGM approving preferential issue
  • February 03, 2025: Initial AO appointment
  • February 24, 2025: Show Cause Notice issued
  • April 02, 2025: Current AO appointment

Impact Assessment

This enforcement action reinforces SEBI’s commitment to ensuring compliance with takeover regulations. It serves as a deterrent for market participants and emphasizes the importance of timely compliance with disclosure and open offer requirements during substantial acquisitions.

Impact Justification

Enforcement action for SAST violations with penalties, relevant for understanding takeover compliance requirements