Description

SEBI grants exemption from open offer requirements for proposed acquisition of shares in Jyothi Labs Limited by M. P. Ramachandran Family Trust I and Trust II under SAST Regulations.

Summary

SEBI has issued an exemption order under Section 11 of the SEBI Act, 1992 read with sub-regulation (5) of Regulation 11 of SAST Regulations, 2011, in the matter of proposed acquisition of shares and voting rights in Jyothi Labs Limited by M. P. Ramachandran Family Trust I and M. P. Ramachandran Family Trust II. The application seeks exemption from sub-regulation (2) of regulation 3 and regulation 5 read with regulation 4 of SAST Regulations for direct and indirect acquisition of shares.

Key Points

  • Application filed on April 30, 2025 with subsequent communications through July 28, 2025
  • Jyothi Labs Limited incorporated on January 15, 1992, listed on BSE and NSE
  • Total issued equity share capital: 36,72,14,511 equity shares of INR 1/- each
  • Promoter group currently holds 62.89% while public shareholding is 37.11% as of June 30, 2025
  • M.P. Ramachandran (Transferor 1) holds 1.75% equity shares (64,12,012 shares)
  • M.G. Shanthakumari (Transferor 2) holds 39.12% equity shares (14,36,40,871 shares)
  • Sahyadri Agencies Limited (SAL) holds 3.95% equity shares and is part of promoter group
  • Proposed acquirers are two family trusts created for succession planning

Regulatory Changes

This order pertains to an exemption application under existing SAST Regulations, 2011. No new regulatory changes are introduced. The exemption sought is from:

  • Sub-regulation (2) of Regulation 3 (threshold-based disclosures)
  • Regulation 5 read with Regulation 4 (mandatory open offer requirements)

Compliance Requirements

  • Acquirer Trusts must comply with all conditions and terms specified in the final exemption order (full order details not provided in excerpt)
  • Target Company must update shareholding pattern post-acquisition
  • Appropriate disclosures to stock exchanges (BSE and NSE) as per listing regulations
  • Compliance with all provisions of SAST Regulations except those specifically exempted

Important Dates

  • Application Date: April 30, 2025
  • Follow-up communications: May 28, 2025, July 23, 2025, July 25, 2025, July 28, 2025
  • Shareholding pattern reference date: June 30, 2025
  • Order Reference: WTM/KCV/CFD/11/2025-26
  • Order Publication Date: October 16, 2025

Impact Assessment

Market Impact: Limited direct market impact as this involves internal promoter group restructuring through family trusts. No change in overall promoter holding percentage expected. Public shareholders are not affected as exemption is sought from open offer requirements.

Corporate Governance Impact: Represents succession planning and wealth management restructuring within the promoter family. Transfer of shares from individual promoters to family trusts is a common estate planning mechanism.

Operational Impact: Minimal operational impact on Jyothi Labs Limited’s business operations. The restructuring is confined to shareholding arrangements among promoters.

Investor Considerations: Investors should monitor final terms of exemption order and ensure that public shareholder interests are adequately protected in the restructuring process.

Impact Justification

Exemption order for promoter group restructuring through family trusts; does not impact public shareholders or trading operations directly but represents significant corporate governance change