Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 [Last amended on December 5, 2025]

Page 1 of 79 SECURITIES AND EXCHANGE BOARD OF INDIA (SUBSTANTIAL ACQUISITION OF SHARES AND TAKEOVERS) REGULATIONS, 2011 [Amended upto December 5, 2025] F. No. LAD-NRO/GN/2011-12/24/30181.—In exercise of the powers conferred under section 30 read with clause (h) of sub-section (2) of section 11 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) the Securities and Exchange Board of India hereby, makes the following regulations, namely: — CHAPTER - I PRELIMINARY Short title, commencement and applicability. 1. (1) These regulations may be called the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. (2) These regulations shall come into force on the thirtieth day from the date of their publication in the Official Gazette. (3) These regulations shall apply to direct and indirect acquisition of shares or voting rights in, or control over target company 1[:] 2[Provided that these regulations shall not apply to direct and indirect acquisition of shares or voting rights in, or control over a company listed without making a public issue, on the 3[ Innovators Growth Platform] of a recognised stock exchange.] Definitions. 2. (1) In these regulations, unless the context otherwise requires, the terms defined herein shall bear the meanings assigned to them below, and their cognate expressions and variations shall be construed accordingly,— 1 Substituted by the SEBI (Listing of Specified Securities on Institutional Trading Platform) Regulations, 2013, for the full stop. 2 Proviso substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2015, w.e.f. 14-8-2015. Prior to its substitution, said Proviso, as inserted by the SEBI (Listing of Specified Securities on Institutional Trading Platform) Regulations, 2013, w.e.f. 8-10-2013, read as under : “Provided that these regulations shall not apply to direct and indirect acquisition of shares or voting rights in, or control over a company listed on the institutional trading platform of a recognized stock exchange” 3 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021, w.e.f. 05-05-2021. Prior to its substitution, it read as, “institutional trading platform”. Page 2 of 79 (a) “acquirer” means any person who, directly or indirectly, acquires or agrees to acquire whether by himself, or through, or with persons acting in concert with him, shares or voting rights in, or control over a target company; (b) “acquisition” means, directly or indirectly, acquiring or agreeing to acquire shares or voting rights in, or control over, a target company; (c) “Act” means the Securities and Exchange Board of India Act, 1992 (15 of 1992); (d) “Board” means the Securities and Exchange Board of India established under section 3 of the Act; (e) “control” includes the right to appoint majority of the directors or to control the management or policy decisions exercisable by a person or persons acting individually or in concert, directly or indirectly, including by virtue of their shareholding or management rights or shareholders agreements or voting agreements or in any other manner: Provided that a director or officer of a target company shall not be considered to be in control over such target company, merely by virtue of holding such position; (f) “convertible security” means a security which is convertible into or ex- changeable with equity shares of the issuer at a later date, with or without the option of the holder of the security, and includes convertible debt instruments and convertible preference shares; 4[(fa) “Delisting Regulations” means the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021;] (g) “disinvestment” means the direct or indirect sale by the Central Government or any State Government or by a government company, as the case may be, of shares or voting rights in, or control over, a target company, which is a public sector undertaking; (h) “enterprise value” means the value calculated as market capitalization of a company plus debt, minority interest and preferred shares, minus total cash and cash equivalents; 4 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Page 3 of 79 (i) “financial year” means the period of twelve months commencing on the first day of the month of April; (j) “frequently traded shares” means shares of a target company, in which the traded turnover on any stock exchange during the twelve calendar months preceding the calendar month in which the public announcement 5[is required to be made under these regulations], is at least ten per cent of the total number of shares of such class of the target company: Provided that where the share capital of a particular class of shares of the target company is not identical throughout such period, the weighted average number of total shares of such class of the target company shall represent the total number of shares; 6[(ja) “fugitive economic offender” shall mean an individual who is declared a fugitive economic offender under section 12 of the Fugitive Economic Offenders Act, 2018 (17 of 2018)] (k) “identified date” means the date falling on the tenth working day prior to the commencement of the tendering period, for the purposes of determining the shareholders to whom the letter of offer shall be sent; (l) “immediate relative” means any spouse of a person, and includes parent, brother, sister or child of such person or of the spouse; (m) “listing agreement” means the agreement with the stock exchange governing the conditions of listing of shares of the target company; 7[(ma) “listing regulations” means the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.] (n) “manager to the open offer” means a merchant banker referred to in regulation 12; (o) “maximum permissible non-public shareholding” means such percentage shareholding in the target company excluding the minimum 5 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to the amendment, it read as “is made”. 6 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. 7 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Page 4 of 79 public shareholding required under the Securities Contracts (Regulation) Rules, 1957; (p) “offer period” means the period between the date of entering into an agreement, formal or informal, to acquire shares, voting rights in, or control over a target company requiring a public announcement, or the date of the public announcement, as the case may be, and the date on which the payment of consideration to shareholders who have accepted the open offer is made, or the date on which open offer is withdrawn, as the case may be; (q) “persons acting in concert” means,— (1) persons who, with a common objective or purpose of acquisition of shares or voting rights in, or exercising control over a target company, pursuant to an agreement or understanding, formal or informal, directly or indirectly co- operate for acquisition of shares or voting rights in, or exercise of control over the target company. (2) Without prejudice to the generality of the foregoing, the persons falling within the following categories shall be deemed to be persons acting in concert with other persons within the same category, unless the contrary is established,— (i) a company, its holding company, subsidiary company and any company under the same management or control; (ii) a company, its directors, and any person entrusted with the management of the company; (iii) directors of companies referred to in item (i) and (ii) of this sub-clause and associates of such directors; (iv) promoters and members of the promoter group; (v) immediate relatives; (vi) a mutual fund, its sponsor, trustees, trustee company, and asset management company; Page 5 of 79 (vii) a collective investment scheme and its collective investment management company, trustees and trustee company; (viii) a venture capital fund and its sponsor, trustees, trustee company and asset management company; 8[(viiia) an alternative investment fund and its sponsor, trustees, trustee company and manager;] (ix) 9[***] (x) a merchant banker and its client, who is an acquirer; (xi) a portfolio manager and its client, who is an acquirer; (xii) banks, financial advisors and stock brokers of the acquirer, or of any company which is a holding company or subsidiary of the acquirer, and where the acquirer is an individual, of the immediate relative of such individual: Provided that this sub-clause shall not apply to a bank whose sole role is that of providing normal commercial banking services or activities in relation to an open offer under these regulations; (xiii) an investment company or fund and any person who has an interest in such investment company or fund as a shareholder or unitholder having not less than 10 per cent of the paid-up capital of the investment company or unit capital of the fund, and any other investment company or fund in which such person or his associate holds not less than 10 per cent of the paid-up capital of that investment company or unit capital of that fund: Provided that nothing contained in this sub-clause shall apply to holding of units of mutual funds registered with the Board; 8 Inserted by the SEBI (Alternative Investment Funds) Regulations, 2012, w.e.f. 21-5-2012. 9 Omitted by the SEBI (Foreign Portfolio Investors) Regulations, 2014, w.e.f. 7-1-2014. Prior to its omission, item (ix) read as under : "(ix) a foreign institutional investor and its sub-accounts;" Page 6 of 79 Explanation.— For the purposes of this clause “associate” of a person means,— (a) any immediate relative of such person; (b) trusts of which such person or his immediate relative is a trustee; (c) partnership firm in which such person or his immediate relative is a partner; and (d) members of Hindu undivided families of which such person is a coparcener; (r) 10[“postal ballot” means a postal ballot as provided for under Rule 22 of the Companies (Management and Administration) Rules, 2014 made under the Companies Act, 2013;] (s) “promoter” has the same meaning as in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 and includes a member of the promoter group; (t) “promoter group” has the same meaning as in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; (u) “public sector undertaking” means a target company in which, directly or indirectly, majority of shares or voting rights or control is held by the Central Government or any State Government or Governments, or partly by the Central Government and partly by one or more State Governments; (v) “shares” means shares in the equity share capital of a target company carrying voting rights, and includes any security which entitles the holder thereof to exercise voting rights; Explanation.— For the purpose of this clause shares will include all depository receipts carrying an entitlement to exercise voting rights in the target company; (w) “specified” means as specified by the Board; 10 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to the amendment, the clause read as: “(r) “postal ballot” means a postal ballot as provided for under the Companies (Passing of the Resolution by Postal Ballot) Rules, 2001 made under the Companies Act, 1956 (1 of 1956)” Page 7 of 79 (x) “state-level financial institution” means a Financial Corporation established under section 3 or section 3A and institutions notified under section 46 of the State Financial Corporations Act, 1951 (63 of 1951), and includes a development corporation established as a company by a State Government with the object of development of industries or agricultural activities in the state; (y) “stock exchange” means a stock exchange which has been granted recognition under section 4 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956); (z) “target company” means a company and includes a body corporate or corporation established under a Central legislation, State legislation or Provincial legislation for the time being in force, whose shares are listed on a stock exchange; (za) “tendering period” means the period within which shareholders may tender their shares in acceptance of an open offer to acquire shares made under these regulations; 11[(zaa) “valuer” shall have the same meaning as assigned to it under section 247 of the Companies Act, 2013 (18 of 2013) as amended from time to time;] (zb) “volume weighted average market price” means the product of the number of equity shares traded on a stock exchange and the price of each equity share divided by the total number of equity shares traded on the stock exchange; (zc) “volume weighted average price” means the product of the number of equity shares bought and price of each such equity share divided by the total number of equity shares bought; (zd) “weighted average number of total shares” means the number of shares at the beginning of a period, adjusted for shares cancelled, bought back or issued during the aforesaid period, multiplied by a time-weighing factor; 11 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026. Page 8 of 79 12[(ze) “wilful defaulter” means any person who is categorized as a wilful defaulter by any bank or financial institution or consortium thereof, in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India and includes any person whose director, promoter or partner is categorized as such;] 13[(zf)] “working day” means any working day of the Board. (2) All other expressions unless defined herein shall have the same meaning as have been assigned to them under the Act or the Securities Contracts (Regulation) Act, 1956, (42 of 1956) or the 14[Companies Act, 2013 (18 of 2013)], or any statutory modification or re-enactment thereto, as the case may be. CHAPTER -II SUBSTANTIAL ACQUISITION OF SHARES, VOTING RIGHTS OR CONTROL Substantial acquisition of shares or voting rights. 3. (1) No acquirer shall acquire shares or voting rights in a target company which taken together with shares or voting rights, if any, held by him and by persons acting in concert with him in such target company, entitle them to exercise twenty-five per cent or more of the voting rights in such target company unless the acquirer makes a public announcement of an open offer for acquiring shares of such target company in accordance with these regulations. (2) No acquirer, who together with persons acting in concert with him, has acquired and holds in accordance with these regulations shares or voting rights in a target company entitling them to exercise twenty-five per cent or more of the voting rights in the target company but less than the maximum permissible non-public shareholding, shall acquire within any financial year additional 12 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2016, w.e.f. 25-05-2016. 13 Clause (ze) renumbered as clause “(zf)” by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2016, w.e.f. 25-05-2016. 14 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to the amendment, it read as “Companies Act, 1956 (1 of 1956)”. Page 9 of 79 shares or voting rights in such target company entitling them to exercise more than five per cent of the voting rights, unless the acquirer makes a public announcement of an open offer for acquiring shares of such target company in accordance with these regulations: 15[Provided that the acquisition beyond five per cent but upto ten per cent of the voting rights in the target company shall be permitted for the financial year 2020-21 only in respect of acquisition by a promoter pursuant to preferential issue of equity shares by the target company.] Provided that such acquirer shall not be entitled to acquire or enter into any agreement to acquire shares or voting rights exceeding such number of shares as would take the aggregate shareholding pursuant to the acquisition above the maximum permissible non-public shareholding. 16[Provided further that, acquisition pursuant to a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, 2016 [No. 31 of 2016] shall be exempt from the obligation under the proviso to the sub- regulation (2) of regulation 3.] Explanation.— For purposes of determining the quantum of acquisition of additional voting rights under this sub-regulation,— (i) gross acquisitions alone shall be taken into account regardless of any intermittent fall in shareholding or voting rights whether owing to disposal of shares held or dilution of voting rights owing to fresh issue of shares by the target company. (ii) in the case of acquisition of shares by way of issue of new shares by the target company or where the target company has made an issue of new shares in any given financial year, the difference between the pre- allotment and the post-allotment percentage voting rights shall be regarded as the quantum of additional acquisition . (3) For the purposes of sub-regulation (1) and sub-regulation (2), acquisition of shares by any person, such that the individual shareholding of such person acquiring shares exceeds the stipulated thresholds, shall also be attracting the 15 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2020, w.e.f. 16-06-2020. 16 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2018, w.e.f. 31-05-2018. Page 10 of 79 obligation to make an open offer for acquiring shares of the target company irrespective of whether there is a change in the aggregate shareholding with persons acting in concert. 17[(4) Nothing contained in this regulation shall apply to acquisition of shares or voting rights of a company by the promoters or shareholders in control, in terms of the provisions of Chapter VI-A of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.] 18[(5) For the purpose of this regulation, any reference to “twenty-five per cent” in case of listed entity which has listed its specified securities on Innovators Growth Platform shall be read as “forty-nine per cent”.] Acquisition of control. 4. Irrespective of acquisition or holding of shares or voting rights in a target company, no acquirer shall acquire, directly or indirectly, control over such target company unless the acquirer makes a public announcement of an open offer for acquiring shares of such target company in accordance with these regulations. Indirect acquisition of shares or control. 5. (1) For the purposes of regulation 3 and regulation 4, acquisition of shares or voting rights in, or control over, any company or other entity, that would enable any person and persons acting in concert with him to exercise or direct the exercise of such percentage of voting rights in, or control over, a target company, the acquisition of which would otherwise attract the obligation to make a public announcement of an open offer for acquiring shares under these regulations, shall be considered as an indirect acquisition of shares or voting rights in, or control over the target company. (2) Notwithstanding anything contained in these regulations, in the case of an indirect acquisition attracting the provisions of sub-regulation (1) where,— 17 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2016, w.e.f. 17-02-2016. 18 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021, w.e.f. 05-05-2021. Page 11 of 79 (a) the proportionate net asset value of the target company as a percentage of the consolidated net asset value of the entity or business being acquired; (b) the proportionate sales turnover of the target company as a percentage of the consolidated sales turnover of the entity or business being acquired; or (c) the proportionate market capitalisation of the target company as a percentage of the enterprise value for the entity or business being acquired; is in excess of eighty per cent, on the basis of the most recent audited annual financial statements, such indirect acquisition shall be regarded as a direct acquisition of the target company for all purposes of these regulations including without limitation, the obligations relating to timing, pricing and other compliance requirements for the open offer. Explanation.— For the purposes of computing the percentage referred to in clause (c) of this sub-regulation, the market capitalisation of the target company shall be taken into account on the basis of the volume-weighted average market price of such shares on the stock exchange for a period of sixty trading days preceding the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain, as traded on the stock exchange where the maximum volume of trading in the shares of the target company are recorded during such period. 19[Delisting Offer. 19 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Before substitution, regulation 5A read as follows: “Delisting offer. 5A. (1) Notwithstanding anything contained in these regulations, in the event the acquirer makes a public announcement of an open offer for acquiring shares of a target company in terms of regulations 3, 4 or 5, he may delist the company in accordance with provisions of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009: Provided that the acquirer shall have declared upfront his intention to so delist at the time of making the detailed public statement and a subsequent declaration of delisting for the purpose of the offer proposed to be made under sub regulation (1) will not suffice. (2) Where an offer made under sub-regulation (1) is not successful,- Page 12 of 79 5A. (1) Notwithstanding anything contained in these regulations and the Delisting Regulations, in the event the acquirer makes a public announcement of an open offer for acquiring shares or voting rights or control of a target company in terms of sub-regulation (1) of regulation 3, regulation 4 or regulation 5, the acquirer may seek the delisting of the target company by making a delisting offer in accordance with this regulation: Provided that the acquirer shall have declared his intention to so delist the target company at the time of making such public announcement of an open offer as well as at the time of making the detailed public statement. A subsequent declaration of (i) on account of non–receipt of prior approval of shareholders in terms of clause (b) of sub- regulation (1) of regulation 8 of Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; or (ii) in terms of regulation 17 of Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; or (iii) on account of the acquirer rejecting the discovered price determined by the book building process in terms of sub-regulation (1) of regulation 16 of Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, the acquirer shall make an announcement within two working days in respect of such failure in all the newspapers in which the detailed public statement was made and shall comply with all applicable provisions of these regulations. (3) In the event of failure of the delisting offer made under sub-regulation (1), the open offer obligations shall be fulfilled by the acquirer in the following manner: (i) the acquirer, through the manager to the open offer, shall within five working days from the date of the announcement under sub-regulation (2), file with the Board, a draft of the letter of offer as specified in sub-regulation (1) of regulation 16; and (ii) shall comply with all other applicable provisions of these regulations. Provided that the offer price shall stand enhanced by an amount equal to a sum determined at the rate of ten per cent per annum for the period between the scheduled date of payment of consideration to the shareholders and the actual date of payment of consideration to the shareholders. Explanation: For the purpose of this sub-regulation, scheduled date shall be the date on which the payment of consideration ought to have been made to the shareholders in terms of the timelines in these regulations. (4) Where a competing offer is made in terms of sub-regulation (1) of regulation 20,- (a) the acquirer shall not be entitled to delist the company; (b) the acquirer shall not be liable to pay interest to the shareholders on account of delay due to competing offer; (c) the acquirer shall comply with all the applicable provisions of these regulations and make an announcement in this regard, within two working days from the date of public announcement made in terms of sub-regulation (1) of regulation 20, in all the newspapers in which the detailed public statement was made. (5) Shareholders who have tendered shares in acceptance of the offer made under sub- regulation (1), shall be entitled to withdraw such shares tendered, within 10 working days from the date of the announcement under sub-regulation (2) . (6) Shareholders who have not tendered their shares in acceptance of the offer made under sub- regulation (1) shall be entitled to tender their shares in acceptance of the offer made under these regulations.” Page 13 of 79 delisting for the purpose of the delisting offer proposed to be made under sub- regulation (1) shall not suffice: Provided further that if the open offer is for an indirect acquisition that is not a deemed direct acquisition under sub-regulation (2) of regulation 5, the declaration of the intent to so delist shall be made initially only in the detailed public statement. Explanation 1: The acquirer shall not, in such target company during the preceding two years from the date of the public announcement made under this regulation, be: (i) a promoter / promoter group / person(s) in control, or (ii) directly / indirectly associated with the promoter or any person(s) in control, or (iii) a person(s) holding more than twenty-five percent shares or voting rights. Explanation 2: The acquirer shall not acquire joint control along with an existing promoter / person in control of the company. (2) The delisting offer obligations shall be fulfilled by the acquirer in the following manner: (a) the public announcement, the detailed public statement and the letter of offer shall mention the open offer price determined in accordance with regulation 8 of these regulations and the indicative price for delisting: Provided that if the open offer is for an indirect acquisition that is not a deemed direct acquisition under sub-regulation (2) of regulation 5, the open offer price and indicative price shall be notified by the acquirer at the time of making the detailed public statement and in the letter of offer: Provided further that the indicative price shall include a suitable premium reflecting the price that the acquirer is willing to pay for the delisting offer with full disclosures of the rationale and justification for the indicative price so determined that can also be revised upwards by the acquirer before the start of the tendering period which shall be duly disclosed to the shareholders. Page 14 of 79 Explanation: Indicative price shall be in accordance with clause (o) of sub- regulation (1) of regulation 2 of the Delisting Regulations and shall not be less than the book value of the company as computed in accordance with the Explanation to sub-regulation (5) of regulation 22 of the Delisting Regulations. (b) in case the response to the offer leads to the delisting threshold as provided under regulation 21 of the Delisting Regulations : (i) being met, all shareholders who tender their shares shall be paid the indicative price; (ii) not being met, all shareholders who tender their shares shall be paid the open offer price. (3) Where a delisting offer made under sub-regulation (1) is not successful: (a) on account of the non–receipt of the prior approval of shareholders in terms of regulation 11 of the Delisting Regulations; or (b) on account of non-receipt of the prior in-principle approval of the relevant stock exchange in terms of regulation 12 of the Delisting Regulations; or (c) the threshold as specified under Regulation 21 of the Delisting Regulations is not achieved; the acquirer shall, within two working days in respect of such failure, make an announcement in all the newspapers in which the detailed public statement was made and comply with all the applicable provisions of these regulations in relation to completing of the open offer. (4) Where a competing offer is made in terms of sub-regulation (1) of regulation 20 of these regulations: (a) the acquirer shall not be entitled to delist the target company; (b) the acquirer shall not be liable to pay interest to the shareholders on account of delay due to the competing offer; and (c) the acquirer shall comply with all the applicable provisions of these regulations and make an announcement in this regard, within two working days from the date of public announcement made in terms of sub-regulation Page 15 of 79 (1) of regulation 20, in all the newspapers where the detailed public statement was made. (5) The shareholders who have tendered shares in acceptance of the offer made under sub-regulation (1), shall be entitled to withdraw such shares tendered, within five working days from the date of the announcement under sub-regulation (3). (6) Where the target company fails to get delisted pursuant to a delisting offer under sub-regulation (1), but which results in the shareholding of the acquirer exceeding the maximum permissible non-public shareholding threshold: (a) the acquirer may undertake a further attempt to delist the target company in accordance with the Delisting Regulations during the period of twelve months from the date of completion of the open offer, subject to the acquirer continuing to exceed the maximum permissible non-public shareholding in the target company. (b) such further delisting attempt shall be successful subject to the following conditions: (i) the delisting threshold as provided under regulation 21 of the Delisting Regulations is met; and (ii) fifty percent of the residual public shareholding is acquired. (c) upon failure of the further delisting attempt, the acquirer shall ensure compliance of the minimum public shareholding requirement of the target company under the Securities Contract (Regulation) Rules, 1957 within a period of twelve months from the end of the period referred to at clause (a). (d) the floor price for a further delisting attempt as referred to at clause (a) shall be higher of the following: (i) the indicative price offered under the first delisting attempt; (ii) the floor price determined under the Delisting Regulations as on the relevant date of the subsequent attempt; and (iii) the book value of the company as computed based on the method stated in explanation to clause (a) under sub-regulation 2. (7) While undertaking delisting for the first or subsequent attempt, all the provisions of the Delisting Regulations shall mutatis-mutandis be applicable, save as otherwise provided in this regulation.] Page 16 of 79 Voluntary Offer. 6. (1) An acquirer, who together with persons acting in concert with him, holds shares or voting rights in a target company entitling them to exercise twenty-five per cent or more but less than the maximum permissible non-public shareholding, shall be entitled to voluntarily make a public announcement of an open offer for acquiring shares in accordance with these regulations, subject to their aggregate shareholding after completion of the open offer not exceeding the maximum permissible non-public shareholding: Provided that where an acquirer or any person acting in concert with him has acquired shares of the target company in the preceding fifty-two weeks without attracting the obligation to make a public announcement of an open offer, he shall not be eligible to voluntarily make a public announcement of an open offer for acquiring shares under this regulation: 20[The relaxation from the first proviso is granted till March 31, 2021.] Provided further that during the offer period such acquirer shall not be entitled to acquire any shares otherwise than under the open offer. (2) An acquirer and persons acting in concert with him, who have made a public announcement under this regulation to acquire shares of a target company shall not be entitled to acquire any shares of the target company for a period of six months after completion of the open offer except pursuant to another voluntary open offer: Provided that such restriction shall not prohibit the acquirer from making a competing offer upon any other person making an open offer for acquiring shares of the target company. (3) Shares acquired through bonus issue or stock splits shall not be considered for purposes of the dis-entitlement set out in this regulation. 21[(4) For the purpose of this regulation, any reference to “twenty-five per cent” in case of listed entity which has listed its specified securities on Innovators Growth Platform shall be read as “forty-nine per cent”.] 20 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2020, w.e.f. 16-06-2020. 21 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021, w.e.f. 05-05-2021. Page 17 of 79 22[6A. Notwithstanding anything contained in these regulations, no person who is a wilful defaulter shall make a public announcement of an open offer for acquiring shares or enter into any transaction that would attract the obligation to make a public announcement of an open offer for acquiring shares under these regulations: Provided that this regulation shall not prohibit the wilful defaulter from making a competing offer in accordance with regulation 20 of these regulations upon any other person making an open offer for acquiring shares of the target company.] 23[6B. Notwithstanding anything contained in these regulations, no person who is a fugitive economic offender shall make a public announcement of an open offer or make a competing offer for acquiring shares or enter into any transaction, either directly or indirectly, for acquiring any shares or voting rights or control of a target company.] Offer Size. 7. (1) The open offer for acquiring shares to be made by the acquirer and persons acting in concert with him under regulation 3 and regulation 4 shall be for at least twenty six per cent of total shares of the target company, as of tenth working day from the closure of the tendering period: Provided that the total shares of the target company as of tenth working day from the closure of the tendering period shall take into account all potential increases in the number of outstanding shares during the offer period contemplated as of the date of the public announcement: Provided further that the offer size shall be proportionately increased in case of an increase in total number of shares, after the public announcement, which is not contemplated on the date of the public announcement. (2) The open offer made under regulation 6 shall be for acquisition of at least such number of shares as would entitle the holder thereof to exercise an additional 22 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2016, w.e.f. 25-05-2016. 23 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Page 18 of 79 ten per cent of the 24[voting rights in] the target company, and shall not exceed such number of shares as would result in the post-acquisition holding of the acquirer and persons acting in concert with him exceeding the maximum permissible non-public shareholding applicable to such target company: Provided that in the event of a competing offer being made, the acquirer who has voluntarily made a public announcement of an open offer under regulation 6 shall be entitled to increase the number of shares for which the open offer has been made to such number of shares as he deems fit: Provided further that such increase in offer size shall have to be made within a period of fifteen working days from the public announcement of a competing offer, failing which the acquirer shall not be entitled to increase the offer size. (3) Upon an acquirer opting to increase the offer size under sub-regulation (2), such open offer shall be deemed to have been made under sub-regulation (2) of regulation 3 and the provisions of these regulations shall apply accordingly. (4) In the event the shares accepted in the open offer were such that the shareholding of the acquirer taken together with persons acting in concert with him pursuant to completion of the open offer results in their shareholding exceeding the maximum permissible non-public shareholding, the acquirer shall be required to bring down the non-public shareholding to the level specified and within the time permitted under Securities Contract (Regulation) Rules, 1957. 25[Provided that if the open offer has been made by an acquirer under sub- regulation (1) of regulation 3, regulation 4 or regulation 5 and the acquirer has stated upfront his intention to retain the listing of the target company in the public announcement and the detailed public statement issued pursuant to an open offer in accordance with these regulations, the acquirer may alternatively undertake a proportionate reduction of the shares or voting rights to be acquired pursuant to the underlying agreement for acquisition/ subscription of shares or 24 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “total shares of”. 25 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Page 19 of 79 voting rights and the purchase of shares so tendered, upon the completion of the open offer process such that the resulting shareholding of the acquirer in the target company does not exceed the maximum permissible non-public shareholding prescribed under the Securities Contract (Regulation) Rules, 1957: Provided further that in case of a preferential allotment pursuant to a Share Subscription Agreement which may trigger an open offer as envisaged in the above proviso, the Board Resolution and shareholder resolution shall be appropriately worded, so as to include the effective date of allocation/allotment and the quantum thereof. Notwithstanding anything contained in regulation 170 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, in case of undertaking a scale down of subscription of shares or voting rights from the agreement, the period of fifteen days for allotment of shares shall be counted from the date of the closure of the tendering period for the open offer. Explanation 1: The acquirer who is undertaking a scale down shall not, in such target company during the preceding two years from the date of the public announcement, be: (i) a promoter / promoter group / person(s) in control, or (ii) directly / indirectly associated with the promoter or any person(s) in control, or (iii) a person(s) holding more than twenty-five percent shares or voting rights. Explanation 2: The acquirer who is undertaking a scale down shall not acquire joint control along with an existing promoter / person in control of the company.] 26[(5) Subject to regulation 5A, the acquirer whose shareholding exceeds the maximum permissible non-public shareholding, pursuant to an open offer 26Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Before substitution, sub-regulation 5 read as follows: Page 20 of 79 under these regulations, shall not be eligible to make a voluntary delisting offer under the Delisting Regulations, unless a period of twelve months has elapsed from the date of the completion of the offer period.] (6) Any open offer made under these regulations shall be made to all shareholders of the target company, other than the acquirer, persons acting in concert with him and the parties to any underlying agreement including persons deemed to be acting in concert with such parties, for the sale of shares of the target company. Offer Price. 8. (1) The open offer for acquiring shares under regulation 3, regulation 4, regulation 5 or regulation 6 shall be made at a price not lower than the price determined in accordance with sub-regulation (2) or sub-regulation (3), as the case may be. (2) In the case of direct acquisition of shares or voting rights in, or control over the target company, and indirect acquisition of shares or voting rights in, or control over the target company where the parameters referred to in sub-regulation (2) of regulation 5 are met, the offer price shall be the highest of,— (a) the highest negotiated price per share of the target company for any acquisition under the agreement attracting the obligation to make a public announcement of an open offer; (b) the volume-weighted average price paid or payable for acquisitions, whether by the acquirer or by any person acting in concert with him, during the fifty-two weeks immediately preceding the date of the public announcement; (c) the highest price paid or payable for any acquisition, whether by the acquirer or by any person acting in concert with him, during the twenty- six weeks immediately preceding the date of the public announcement; “(5) The acquirer whose shareholding exceeds the maximum permissible non-public shareholding, pursuant to an open offer under these regulations, shall not be eligible to make a voluntary delisting offer under the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, unless a period of twelve months has elapsed from the date of the completion of the offer period.” Page 21 of 79 (d) the volume-weighted average market price of such shares for a period of sixty trading days immediately preceding the date of the public announcement as traded on the stock exchange where the maximum volume of trading in the shares of the target company are recorded during such period, provided such shares are frequently traded; 27[Provided that the price determined as per clause (d) shall not apply in the case of disinvestment of a public sector undertaking by the Central Government or a State Government, as the case may be: Provided further that this proviso shall apply only in case of a change in control in the public sector undertaking.] (e) where the shares are not frequently traded, the price determined by 28[an independent registered valuer] taking into account valuation parameters including, book value, comparable trading multiples, and such other parameters as are customary for valuation of shares of such companies 29[:] 30[Provided that the acquirer and the manager to the open offer shall complete the ongoing valuation assignment which has been undertaken prior to the coming into force of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 within a period of nine months from the date of coming into force of the said regulations; and] (f) the per share value computed under sub-regulation (5), if applicable. (3) In the case of an indirect acquisition of shares or voting rights in, or control over the target company, where the parameter referred to in sub-regulation (2) of regulation 5 are not met, the offer price shall be the highest of,— 27 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2022, w.e.f. 9-11-2022. 28 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026 for the words “the acquirer and the manager to the open offer”. 29 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026 for the word and symbol “; and”. 30 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026. Page 22 of 79 (a) the highest negotiated price per share, if any, of the target company for any acquisition under the agreement attracting the obligation to make a public announcement of an open offer; (b) the volume-weighted average price paid or payable for any acquisition, whether by the acquirer or by any person acting in concert with him, during the fifty-two weeks immediately preceding the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain; (c) the highest price paid or payable for any acquisition, whether by the acquirer or by any person acting in concert with him, during the twenty- six weeks immediately preceding the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain; (d) the highest price paid or payable for any acquisition, whether by the acquirer or by any person acting in concert with him, between the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain, and the date of the public announcement of the open offer for shares of the target company made under these regulations; (e) the volume-weighted average market price of the shares for a period of sixty trading days immediately preceding the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain, as traded on the stock exchange where the maximum volume of trading in the shares of the target company are recorded during such period, provided such shares are frequently traded; Page 23 of 79 31[Provided that the price determined as per clause (e) shall not apply in the case of disinvestment of a public sector undertaking by the Central Government or a State Government, as the case may be: Provided further that this proviso shall apply only in case of a change in control in the public sector undertaking;] and (f) the per share value computed under sub-regulation (5). (4) In the event the offer price is incapable of being determined under any of the parameters specified in sub-regulation (3), without prejudice to the requirements of sub-regulation (5), the offer price shall be the fair price of shares of the target company to be determined by 32[an independent registered valuer] taking into account valuation parameters including, book value, comparable trading multiples, and such other parameters as are customary for valuation of shares of such companies33[:] 34[Provided that the acquirer and the manager to the open offer shall complete the ongoing valuation assignment which has been undertaken prior to the coming into force of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 within a period of nine months from the date of coming into force of the said regulations.] (5) In the case of an indirect acquisition and open offers under sub-regulation (2) of regulation 5 where,— (a) the proportionate net asset value of the target company as a percentage of the consolidated net asset value of the entity or business being acquired; (b) the proportionate sales turnover of the target company as a percentage of the consolidated sales turnover of the entity or business being acquired; or 31 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2022, w.e.f. 9-11-2022. 32 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026 for the words “the acquirer and the manager to the open offer”. 33 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026 for the symbol “.”. 34 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026. Page 24 of 79 (c) the proportionate market capitalization of the target company as a percentage of the enterprise value for the entity or business being acquired; is in excess of fifteen per cent, on the basis of the most recent audited annual financial statements, the acquirer shall, notwithstanding anything contained in sub-regulation (2) or sub-regulation (3), be required to compute and disclose, in the letter of offer, the per share value of the target company taken into account for the acquisition, along with a detailed description of the methodology adopted for such computation. Explanation.— For the purposes of computing the percentages referred to in clause (c) of this sub-regulation, the market capitalisation of the target company shall be taken into account on the basis of the volume-weighted average market price of such shares on the stock exchange for a period of sixty trading days preceding the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain, as traded on the stock exchange where the maximum volume of trading in the shares of the target company are recorded during such period. (6) For the purposes of sub-regulation (2) and sub-regulation (3), where the acquirer or any person acting in concert with him has any outstanding convertible instruments convertible into shares of the target company at a specific price, the price at which such instruments are to be converted into shares, shall also be considered as a parameter under sub-regulation (2) and sub-regulation (3). (7) For the purposes of sub-regulation (2) and sub-regulation (3), the price paid for shares of the target company shall include any price paid or agreed to be paid for the shares or voting rights in, or control over the target company, in any form whatsoever, whether stated in the agreement for acquisition of shares or in any incidental, contemporaneous or collateral agreement, whether termed as control premium or as non-compete fees or otherwise. (8) Where the acquirer has acquired or agreed to acquire whether by himself or through or with persons acting in concert with him any shares or voting rights in the target company during the offer period, whether by subscription or purchase, Page 25 of 79 at a price higher than the offer price, the offer price shall stand revised to the highest price paid or payable for any such acquisition: Provided that no such acquisition shall be made after the third working day prior to the commencement of the tendering period and until the expiry of the tendering period. (9) The price parameters under sub-regulation (2) and sub-regulation (3) may be adjusted by the acquirer in consultation with the manager to the offer, for corporate actions such as issuances pursuant to rights issue, bonus issue, stock consolidations, stock splits, payment of dividend, de-mergers and reduction of capital, where the record date for effecting such corporate actions falls prior to three working days before the commencement of the tendering period: Provided that no adjustment shall be made for dividend declared with a record date falling during such period except where the dividend per share is more than fifty per cent higher than the average of the dividend per share paid during the three financial years preceding the date of the public announcement. (10) Where the acquirer or persons acting in concert with him acquires shares of the target company during the period of twenty-six weeks after the tendering period at a price higher than the offer price under these regulations, the acquirer and persons acting in concert shall pay the difference between the highest acquisition price and the offer price, to all the shareholders whose shares were accepted in the open offer, within sixty days from the date of such acquisition: Provided that this provision shall not be applicable to acquisitions under another open offer under these regulations or pursuant to the 35 [Delisting Regulations], or open market purchases made in the ordinary course on the stock exchanges, not being negotiated acquisition of shares of the target company whether by way of bulk deals, block deals or in any other form. (11) Where the open offer is subject to a minimum level of acceptances, the acquirer may, subject to the other provisions of this regulation, indicate a lower price, which will not be less than the price determined under this regulation, for acquiring all the acceptances despite the acceptance falling short of the indicated 35 Substituted for “Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009”, by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Page 26 of 79 minimum level of acceptance, in the event the open offer does not receive the minimum acceptance. (12) In the case of any indirect acquisition, other than the indirect acquisition referred in sub-regulation (2) of regulation 5, the offer price shall stand enhanced by an amount equal to a sum determined at the rate of ten per cent per annum for the period between the earlier of the date on which the primary acquisition is contracted or the date on which the intention or the decision to make the primary acquisition is announced in the public domain, and the date of the detailed public statement, provided such period is more than five working days. (13) The offer price for partly paid up shares shall be computed as the difference between the offer price and the amount due towards calls-in-arrears including calls remaining unpaid with interest, if any, thereon. (14) The offer price for equity shares carrying differential voting rights shall be determined by the acquirer and the manager to the open offer with full disclosure of justification for the price so determined, being set out in the detailed public statement and the letter of offer: Provided that such price shall not be lower than the amount determined by applying the percentage rate of premium, if any, that the offer price for the equity shares carrying full voting rights represents to the price parameter computed under clause (d) of sub-regulation 2, or as the case may be, clause (e) of sub-regulation 3, to the volume-weighted average market price of the shares carrying differential voting rights for a period of sixty trading days computed on the same terms as specified in the aforesaid provisions, subject to shares carrying full voting rights and the shares carrying differential voting rights, both being frequently traded shares. (15) In the event of any of the price parameters contained in this regulation not being available or denominated in Indian rupees, the conversion of such amount into Indian rupees shall be effected at the exchange rate as prevailing on the date preceding the date of public announcement and the acquirer shall set out the source of such exchange rate in the public announcement, the detailed public statement and the letter of offer. Page 27 of 79 36[(16) For purposes of clause (e) of sub-regulation (2) and sub-regulation (4), the Board may, at the expense of the acquirer, require valuation of the shares by an independent registered valuer: Provided that the independent merchant banker other than the manager to the open offer or the independent chartered accountant shall complete the ongoing valuation assignment which has been undertaken prior to the coming into force of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 within a period of nine months from the date of coming into force of the said regulations.] 37[(17) The effect on the price of the equity shares of the target company due to material price movement and confirmation of reported event or information may be excluded as per the framework specified under sub-regulation (11) of regulation 30 of the listing regulations for determination of the offer price under this regulation.] Mode of payment. 9. (1) The offer price may be paid, — (a) in cash; (b) by issue, exchange or transfer of listed shares in the equity share capital of the acquirer or of any person acting in concert; (c) by issue, exchange or transfer of listed secured debt instruments issued by the acquirer or any person acting in concert with a rating not inferior to investment grade as rated by a credit rating agency registered with the Board; 36 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025, w.e.f. 03.01.2026. Prior to the substitution, sub-regulation (16) read as under: “(16) For purposes of clause (e) of sub-regulation (2) and sub-regulation (4), the Board may, at the expense of the acquirer, require valuation of the shares by an independent merchant banker other than the manager to the open offer or an independent chartered accountant in practice having a minimum experience of ten years.” 37 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2024 w.e.f 18.05.2024. Page 28 of 79 (d) by issue, exchange or transfer of convertible debt securities entitling the holder thereof to acquire listed shares in the equity share capital of the acquirer or of any person acting in concert; or (e) a combination of the mode of payment of consideration stated in clause (a), clause (b), clause (c) and clause (d): Provided that where any shares have been acquired or agreed to be acquired by the acquirer and persons acting in concert with him during the fifty-two weeks immediately preceding the date of public announcement constitute more than ten per cent of the voting rights in the target company and has been paid for in cash, the open offer shall entail an option to the shareholders to require payment of the offer price in cash, and a shareholder who has not exercised an option in his acceptance shall be deemed to have opted for receiving the offer price in cash: Provided further that in case of revision in offer price the mode of payment of consideration may be altered subject to the condition that the component of the offer price to be paid in cash prior to such revision is not reduced. (2) For the purposes of clause (b), clause (d) and clause (e) of sub-regulation (1), the shares sought to be issued or exchanged or transferred or the shares to be issued upon conversion of other securities, towards payment of the offer price, shall conform to the following requirements, — (a) such class of shares are listed on a stock exchange and frequently traded at the time of the public announcement; (b) such class of shares have been listed for a period of at least two years preceding the date of the public announcement; (c) the issuer of such class of shares has redressed at least ninety five per cent. of the complaints received from investors by the end of the calendar quarter immediately preceding the calendar month in which the public announcement is made; Page 29 of 79 (d) the issuer of such class of shares has been in material compliance with the 38[listing regulations] for a period of at least two years immediately preceding the date of the public announcement: Provided that in case where the Board is of the view that a company has not been materially compliant with the provisions of the 39[listing regulations], the offer price shall be paid in cash only; (e) the impact of auditors’ qualifications, if any, on the audited accounts of the issuer of such shares for three immediately preceding financial years does not exceed five per cent. of the net profit or loss after tax of such issuer for the respective years; and (f) the Board has not issued any direction against the issuer of such shares not to access the capital market or to issue fresh shares. (3) Where the shareholders have been provided with options to accept payment in cash or by way of securities, or a combination thereof, the pricing for the open offer may be different for each option subject to compliance with minimum offer price requirements under regulation 8: Provided that the detailed public statement and the letter of offer shall contain justification for such differential pricing. (4) In the event the offer price consists of consideration to be paid by issuance of securities, which requires compliance with any applicable law, the acquirer shall ensure that such compliance is completed not later than the commencement of the tendering period: Provided that in case the requisite compliance is not made by such date, the acquirer shall pay the entire consideration in cash. (5) Where listed securities are offered as consideration, the value of such securities shall be higher of: (a) the average of the weekly high and low of the closing prices of such securities quoted on the stock exchange during the six months preceding the relevant date; 38Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “listing agreement”. 39 Ibid Page 30 of 79 (b) the average of the weekly high and low of the closing prices of such securities quoted on the stock exchange during the two weeks preceding the relevant date; and (c) the volume-weighted average market price for a period of sixty trading days preceding the date of the public announcement, as traded on the stock exchange where the maximum volume of trading in the shares of the company whose securities are being offered as consideration, are recorded during the six-month period prior to relevant date and the ratio of exchange of shares shall be duly certified by an independent 40[registered valuer:] 41[Provided that the independent merchant banker (other than the manager to the open offer) or the independent chartered accountant shall complete the ongoing valuation assignment which has been undertaken prior to the coming into force of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 within a period of nine months from the date of coming into force of the said regulations.] Explanation.— For the purposes of this sub-regulation, the “relevant date” shall be the thirtieth day prior to the date on which the meeting of shareholders is held to consider the proposed issue of shares under sub- section (1A) of Section 81 of the 42[Companies Act, 2013 (18 of 2013)]. 43[(6) The effect on the price of the listed equity shares, which are offered as consideration, due to material price movement and confirmation of reported event or information may be excluded as per the framework specified under sub-regulation (11) of regulation 30 of the listing regulations for determination of the price of such equity shares under this regulation.] 40 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026 for the words and symbols “independent merchant banker (other than the manager to the open offer) or an independent chartered accountant having a minimum experience of ten years”. 41 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 w.e.f. 03.01.2026. 42Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “Companies Act, 1956 (1 of 1956)”. 43 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2024 w.e.f 18.05.2024. Page 31 of 79 General exemptions. 10. (1) The following acquisitions shall be exempt from the obligation to make an open offer under regulation 3 and regulation 4 subject to fulfillment of the conditions stipulated therefor,— (a) acquisition pursuant to inter se transfer of shares amongst qualifying persons, being,— (i) immediate relatives; (ii) persons named as promoters in the shareholding pattern filed by the target company in terms of the 44[listing regulations or as the case may be, the listing agreement] or these regulations for not less than three years prior to the proposed acquisition; (iii) a company, its subsidiaries, its holding company, other subsidiaries of such holding company, persons holding not less than fifty per cent of the equity shares of such company, other companies in which such persons hold not less than fifty per cent of the equity shares, and their subsidiaries subject to control over such qualifying persons being exclusively held by the same persons; 45[Explanation: For the purpose of this sub-clause, the company shall include a body corporate, whether Indian or foreign.] (iv) persons acting in concert for not less than three years prior to the proposed acquisition, and disclosed as such pursuant to filings under the 46[listing regulations or as the case may be, the listing agreement]; (v) shareholders of a target company who have been persons acting in concert for a period of not less than three years prior to the proposed acquisition and are disclosed as such pursuant to filings under the 47[listing regulations or as the case may be, the listing 44 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “listing agreement”. 45 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. 46 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “listing agreement”. 47 Ibid Page 32 of 79 agreement], and any company in which the entire equity share capital is owned by such shareholders in the same proportion as their holdings in the target company without any differential entitlement to exercise voting rights in such company: Provided that for purposes of availing of the exemption under this clause,— (i) If the shares of the target company are frequently traded, the acquisition price per share shall not be higher by more than twenty-five per cent of the volume-weighted average market price for a period of sixty trading days preceding the date of issuance of notice for the proposed inter se transfer under sub-regulation (5), as traded on the stock exchange where the maximum volume of trading in the shares of the target company are recorded during such period, and if the shares of the target company are infrequently traded, the acquisition price shall not be higher by more than twenty-five percent of the price determined in terms of clause (e) of sub- regulation (2) of regulation 8; and (ii) the transferor and the transferee shall have complied with applicable disclosure requirements set out in Chapter V. (b) acquisition in the ordinary course of business by,— (i) an underwriter registered with the Board by way of allotment pursuant to an underwriting agreement in terms of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; (ii) a stock broker registered with the Board on behalf of his client in exercise of lien over the shares purchased on behalf of the client under the bye-laws of the stock exchange where such stock broker is a member; (iii) a merchant banker registered with the Board or a nominated investor in the process of market making or subscription to the Page 33 of 79 unsubscribed portion of issue in terms of Chapter XB of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; (iv) any person acquiring shares pursuant to a scheme of safety net in terms of regulation 44 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; (v) a merchant banker registered with the Board acting as a stabilising agent or by the promoter or pre-issue shareholder in terms of regulation 45 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; (vi) by a registered market-maker of a stock exchange in respect of shares for which he is the market maker during the course of market making; (vii) a Scheduled Commercial Bank, acting as an escrow agent; and (viii) invocation of pledge by Scheduled Commercial Banks or Public Financial Institutions as a pledgee. (c) acquisitions at subsequent stages, by an acquirer who has made a public announcement of an open offer for acquiring shares pursuant to an agreement of disinvestment, as contemplated in such agreement: Provided that,— (i) both the acquirer and the seller are the same at all the stages of acquisition; and (ii) full disclosures of all the subsequent stages of acquisition, if any, have been made in the public announcement of the open offer and in the letter of offer. (d) acquisition pursuant to a scheme,— (i) made under section 18 of the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986) or any statutory modification or re-enactment thereto; (ii) of arrangement involving the target company as a transferor company or as a transferee company, or reconstruction of the Page 34 of 79 target company, including amalgamation, merger or demerger, pursuant to an order of a court [or a tribunal]48 [***]49under any law or regulation, Indian or foreign; or (iii) of arrangement not directly involving the target company as a transferor company or as a transferee company, or reconstruction not involving the target company’s undertaking, including amalgamation, merger or demerger, pursuant to an order of a court 50[or a tribunal] or [***]51under any law or regulation, Indian or foreign, subject to,— (A) the component of cash and cash equivalents in the consideration paid being less than twenty-five per cent of the consideration paid under the scheme; and (B) where after implementation of the scheme of arrangement, persons directly or indirectly holding at least thirty-three per cent of the voting rights in the combined entity are the same as the persons who held the entire voting rights before the implementation of the scheme. 52[(da) acquisition pursuant to a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016);] (e) acquisition pursuant to the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002); 53[(f) acquisition pursuant to the provisions of the Delisting Regulations;] (g) acquisition by way of transmission, succession or inheritance; 48 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2017, w.e.f 14.8.2017. 49 Words “or a competent authority” omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. 50 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2017, w.e.f 14.8.2017. 51 Words “or a competent authority” omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. 52 Inserted ibid. 53 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Before substitution, clause (f) read as follows: “(f) acquisition pursuant to the provisions of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009;” Page 35 of 79 (h) acquisition of voting rights or preference shares carrying voting rights arising out of the operation of 54[sub-section (2) of section 47 of the Companies Act, 2013 (18 of 2013)]. 55[(i) Acquisition of shares by the lenders pursuant to conversion of their debt as part of a debt restructuring [***]56 implemented in accordance with the guidelines specified by the Reserve Bank of India: [Provided that the conditions specified under sub-regulation (6) of regulation 158 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 are complied with]57] [Explanation. – For the purpose of this clause, “lenders” shall mean all scheduled commercial banks (excluding Regional Rural Banks) and All India Financial Institutions]58 59[(ia) [***]60] 54 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “sub-section (2) of section 87 of the Companies Act, 1956 (1 of 1956)”. 55 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2017, w.e.f 14.8.2017. Prior to the substitution, clause (i), inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2015, w.e.f. 05-05-2015, read as follows: “Conversion of debt into equity under Strategic Debt Restructuring Scheme - Acquisition of equity shares by the consortium of banks, financial institutions and other secured lenders pursuant to conversion of their debt as part of the Strategic Debt Restructuring Scheme in accordance with the guidelines specified by the Reserve Bank of India: Provided that the conditions specified under sub-regulation (5) or (6) of regulation 70 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as may be applicable, are complied with.” 56 The word “scheme” omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. 57 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. Prior to its substitution, the proviso read as follows,- “Provided that the conditions specified under sub-regulation (5) of regulation 70 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 are complied with.” 58 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. 59 Inserted ibid. 60 Omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. Prior to its omission, clause (ia) read as follows,- “Acquisition of shares by the person(s), by way of allotment by the target company or purchase from the lenders at the time of lenders selling their shareholding or enforcing change in ownership in favour of such person(s), pursuant to a debt restructuring scheme implemented in accordance with the guidelines specified by the Reserve Bank of India: Provided that in respect of acquisition by persons by way of allotment by the target company, the conditions specified under sub-regulation (6) of regulation 70 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 are complied with: Page 36 of 79 61[(j) increase in voting rights arising out of the operation of sub-section (1) of section 106 of the Companies Act, 2013 or pursuant to a forfeiture of shares by the target company, undertaken in compliance with the provisions of the Companies Act, 2013 and its articles of association.] (2) [***]62 63[(2A) An increase in the voting rights of any shareholder beyond the threshold limits stipulated in sub-regulations (1) and (2) of regulation 3, without the acquisition of control, pursuant to the conversion of equity shares with superior voting rights into Provided further that in respect of acquisition by way of purchase of shares from the lenders, the acquisition shall be exempted subject to the compliance with the following conditions: (a) the guidelines for determining the purchase price have been specified by the Reserve Bank of India and that the purchase price has been determined in accordance with such guidelines; (b) the purchase price shall be certified by two independent qualified valuers, and for this purpose ‘valuer’ shall be a person who is registered under section 247 of the Companies Act, 2013 and the relevant Rules framed thereunder: Provided that till such date on which section 247 of the Companies Act, 2013 and the relevant Rules come into force, valuer shall mean an independent merchant banker registered with the Board or an independent chartered accountant in practice having a minimum experience of ten years; (c) the specified securities so purchased shall be locked-in for a period of at least three years from the date of purchase; (d) the lock-in of equity shares acquired pursuant to conversion of convertible securities purchased from the lenders shall be reduced to the extent the convertible securities have already been locked-in; (e) a special resolution has been passed by shareholders of the issuer before the purchase; (f) the issuer shall, in addition to the disclosures required under the Companies Act, 2013 or any other applicable law, disclose the following information pertaining to the proposed acquirer(s) in the explanatory statement to the notice for the general meeting proposed for passing special resolution as stipulated at clause (e) of this sub-regulation: a. the identity including of the natural persons who are the ultimate beneficial owners of the shares proposed to be purchased and/ or who ultimately control the proposed acquirer(s); b. the business model; c. a statement on growth of business over the period of time; d. summary of audited financials of previous three financial years; e. track record in turning around companies, if any; f. the proposed roadmap for effecting turnaround of the issuer; g. applicable provisions of the Companies Act, 2013 are complied with.” 61 Inserted by the SEBI(Substantial Acquisition of Shares and Takeovers) (Fourth Amendment) Regulations, 2015, w.e.f. 22-12-2015. 62 Omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019, w.e.f 29.03.2019. Prior to its omission, sub-regulation (2) read as follows,- “The acquisition of shares of a target company, not involving a change of control over such target company, pursuant to a scheme of corporate debt restructuring in terms of the Corporate Debt Restructuring Scheme notified by the Reserve Bank of India vide circular no. B.P.BC 15/21.04, 114/2001 dated August 23, 2001, or any modification or re-notification thereto provided such scheme has been authorised by shareholders by way of a special resolution passed by postal ballot, shall be exempted from the obligation to make an open offer under regulation 3” 63 Inserted by the SEBI(Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2019, w.e.f. 29-07-2019. Page 37 of 79 ordinary equity shares, shall be exempted from the obligation to make an open offer under regulation 3.] 64[(2B) Any acquisition of shares or voting rights or control of the target company by way of preferential issue in compliance with regulation 164A of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 shall be exempt from the obligation to make an open offer under sub-regulation (1) of regulation 3 and regulation 4. Explanation.- The above exemption from open offer shall also apply to the target company with infrequently traded shares which is compliant with the provisions of sub-regulations (2), (3), (4), (5),(6), (7) and (8) of regulation 164A of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018. The pricing of such infrequently traded shares shall be in terms of regulation 165 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018.] (3) An increase in voting rights in a target company of any shareholder beyond the limit attracting an obligation to make an open offer under sub-regulation (1) of regulation 3, pursuant to buy-back of shares 65[by the target company] shall be exempt from the obligation to make an open offer provided such shareholder reduces his shareholding such that his voting rights fall to below the threshold referred to in sub-regulation (1) of regulation 3 within ninety days from the date 66[of the closure of the said buy-back offer]. (4) The following acquisitions shall be exempt from the obligation to make an open offer under sub-regulation (2) of regulation 3,— (a) acquisition of shares by any shareholder of a target company, upto his entitlement, pursuant to a rights issue; (b) acquisition of shares by any shareholder of a target company, beyond his entitlement, pursuant to a rights issue, subject to fulfillment of the following conditions,— 64 Inserted by the SEBI(Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2020, w.e.f. 22-06-2020. 65 Inserted by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. 66 Substituted for “on which the voting rights so increase” by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. Page 38 of 79 (i) the acquirer has not renounced any of his entitlements in such rights issue; and (ii) the price at which the rights issue is made is not higher than the ex-rights price of the shares of the target company, being the sum of,— (A) the volume weighted average market price of the shares of the target company during a period of sixty trading days ending on the day prior to the date of determination of the rights issue price, multiplied by the number of shares outstanding prior to the rights issue, divided by the total number of shares outstanding after allotment under the rights issue: Provided that such volume weighted average market price shall be determined on the basis of trading on the stock exchange where the maximum volume of trading in the shares of such target company is recorded during such period; and (B) the price at which the shares are offered in the rights issue, multiplied by the number of shares so offered in the rights issue divided by the total number of shares outstanding after allotment under the rights issue: (c) increase in voting rights in a target company of any shareholder pursuant to buy-back of shares: Provided that,— (i) such shareholder has not voted in favour of the resolution authorising the buy-back of securities under 67[section 68 of the Companies Act, 2013 (18 of 2013)]; (ii) in the case of a shareholder resolution, voting is by way of postal ballot; (iii) where a resolution of shareholders is not required for the buy- back, such shareholder, in his capacity as a director, or any other interested director has not voted in favour of the 67 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “section 77A of the Companies Act, 1956 (1 of 1956).” Page 39 of 79 resolution of the board of directors of the target company authorising the buy-back of securities under 68[section 68 of the Companies Act, 2013 (18 of 2013)]; and (iv) the increase in voting rights does not result in an acquisition of control by such shareholder over the target company: Provided further that where the aforesaid conditions are not met, in the event such shareholder reduces his shareholding such that his voting rights fall below the level at which the obligation to make an open offer would be attracted under sub- regulation (2) of regulation 3, within ninety days from the date 69[of closure of the buy-back offer by the target company], the shareholder shall be exempt from the obligation to make an open offer; (d) acquisition of shares in a target company by any person in exchange for shares of another target company tendered pursuant to an open offer for acquiring shares under these regulations; (e) acquisition of shares in a target company from state-level financial institutions or their subsidiaries or companies promoted by them, by promoters of the target company pursuant to an agreement between such transferors and such promoter; (f) acquisition of shares in a target company from a venture capital fund 70[or category I Alternative Investment Fund] or a foreign venture capital investor registered with the Board, by promoters of the target company pursuant to an agreement between such venture capital fund 71[or category I Alternative Investment Fund] or foreign venture capital investor and such promoters. (5) In respect of acquisitions under clause (a) of sub-regulation (1), and clauses (e) and (f) of sub-regulation (4), the acquirer shall intimate the stock exchanges where the shares of the target company are listed, the details of the proposed acquisition in such form as may be specified, at least four working days prior to the proposed 68 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “section 77A of the Companies Act, 1956 (1 of 1956).” 69 Substituted for “on which the voting rights so increase” by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. 70 Inserted by the SEBI (Alternative Investment Funds) Regulations, 2012, w.e.f 21-05-2012. 71 Ibid. Page 40 of 79 acquisition, and the stock exchange shall forthwith disseminate such information to the public. (6) In respect of any acquisition made pursuant to exemption provided for in this regulation, the acquirer shall file a report with the stock exchanges where the shares of the target company are listed, in such form as may be specified not later than four working days from the acquisition, and the stock exchange shall forthwith disseminate such information to the public. (7) 72[In respect of any acquisition of or increase in voting rights pursuant to exemption provided for in clause (a) of sub-regulation (1), sub-clause (iii) of clause (d) of sub- regulation (1), clause (h) of sub-regulation (1), sub-regulation (2), sub-regulation (3) and clause (c) of sub-regulation (4), clauses (a), (b) and (f) of sub-regulation (4), the acquirer shall, within twenty-one working days of the date of acquisition, submit a report in such form as may be specified along with supporting documents to the Board giving all details in respect of acquisitions, along with a non-refundable fee of rupees one lakh fifty thousand by way of direct credit into the bank account through NEFT/RTGS/IMPS or online payment using the SEBI Payment Gateway or any other mode as may be specified by the Board from time to time.] Explanation.— For the purposes of sub-regulation (5), sub-regulation (6) and sub- regulation (7) in the case of convertible securities, the date of the acquisition shall be the date of conversion of such securities. Exemptions by the Board. 11.(1) The Board may for reasons recorded in writing, grant exemption from the obligation to make an open offer for acquiring shares under these regulations 72 Substituted by the SEBI (Payment of Fees) (Amendment) Regulations, 2023, w.e.f 01-04-2023. Prior to its substitution, the sub-regulation read as under: “(7) In respect of any acquisition of or increase in voting rights pursuant to exemption provided for in clause (a) of sub-regulation (1), sub-clause (iii) of clause (d) of sub-regulation (1), clause (h) of sub- regulation (1), sub-regulation (2), sub-regulation (3) and clause (c) of sub-regulation (4), clauses (a), (b) and (f) of sub-regulation (4), the acquirer shall, within twenty-one working days of the date of acquisition, submit a report in such form as may be specified along with supporting documents to the Board giving all details in respect of acquisitions, along with a non-refundable fee of rupees *[one lakh fifty thousand] **[by way of direct credit in the bank account through NEFT/RTGS/IMPS or any other mode allowed by RBI or] by way of a banker’s cheque or demand draft payable in Mumbai in favour of the Board.” * [Substituted by the SEBI (Payment of fees) (Amendment) Regulations, 2014 w.e.f. 23-05-2014, for the words “twenty five thousand.”] **[Inserted by the SEBI (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2017, w.e.f. 6-3-2017] Page 41 of 79 subject to such conditions as the Board deems fit to impose in the interests of investors in securities and the securities market. (2) The Board may for reasons recorded in writing, grant a relaxation from strict compliance with any procedural requirement under Chapter III and Chapter IV subject to such conditions as the Board deems fit to impose in the interests of investors in securities and the securities market on being satisfied that,— (a) the target company is a company in respect of which the Central Government or State Government or any other regulatory authority has superseded the board of directors of the target company and has appointed new directors under any law for the time being in force, if,— (i) such board of directors has formulated a plan which provides for transparent, open, and competitive process for acquisition of shares or voting rights in, or control over the target company to secure the smooth and continued operation of the target company in the interests of all stakeholders of the target company and such plan does not further the interests of any particular acquirer; (ii) the conditions and requirements of the competitive process are reasonable and fair; (iii) the process adopted by the board of directors of the target company provides for details including the time when the open offer for acquiring shares would be made, completed and the manner in which the change in control would be effected; and (b) the provisions of Chapter III and Chapter IV are likely to act as impediment to implementation of the plan of the target company and exemption from strict compliance with one or more of such provisions is in public interest, the interests of investors in securities and the securities market. (3) For seeking exemption under sub-regulation (1), the acquirer shall, and for seeking relaxation under sub-regulation (2) the target company shall file an application with the Board, supported by a duly sworn affidavit, giving details of the proposed acquisition and the grounds on which the exemption has been sought. Page 42 of 79 (4) 73[The acquirer or the target company, as the case may be, shall along with the application referred to under sub-regulation (3) pay a non-refundable fee of rupees five lakh, by way of direct credit into the bank account through NEFT/RTGS/IMPS or online payment using the SEBI Payment Gateway or any other mode as may be specified by the Board from time to time.] (5) The Board may after affording reasonable opportunity of being heard to the applicant and after considering all the relevant facts and circumstances, pass a reasoned order either granting or rejecting the exemption or relaxation sought as expeditiously as possible: Provided that the Board may constitute a panel of experts to which an application for an exemption under sub-regulation (1) may, if considered necessary, be referred to make recommendations on the application to the Board. (6) The order passed under sub-regulation (5) shall be hosted by the Board on its official website. CHAPTER – III OPEN OFFER PROCESS Manager to the open offer. 12. (1) Prior to making a public announcement, the acquirer shall appoint a merchant banker registered with the Board, who is not an associate of the acquirer, as the manager to the open offer. Explanation.— For the purposes of this regulation the term “associate” has the same meaning as in the Securities and Exchange Board of India (Merchant Bankers) Regulations, 1992. 73 Substituted by the SEBI (Payment of Fees) (Amendment) Regulations, 2023, w.e.f 01-04-2023. Prior to its substitution, the sub-regulation read as under: “(4) The acquirer or the target company, as the case may be, shall along with the application referred to under sub-regulation (3)pay a non-refundable fee of rupees *[five lakh], **[by way of direct credit in the bank account through NEFT/RTGS/IMPS or any other mode allowed by RBI or] by way of a banker’s cheque or demand draft payable in Mumbai in favour of the Board.” *[Substituted for the words #[“three lakh”] by the SEBI (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2017, w.e.f. 6-3-2017. **[ Inserted by the SEBI (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2017, w.e.f. 6-3-2017] #[Substituted for the words “fifty thousand” by the SEBI (Payment of fees) (Amendment) Regulations, 2014 w.e.f. 23-05-2014] Page 43 of 79 (2) The public announcement of the open offer for acquiring shares required under these regulations shall be made by the acquirer through such manager to the open offer. Timing. 13. (1) The public announcement referred to in regulation 3 and regulation 4 shall be made in accordance with regulation 14 and regulation 15, on the date of agreeing to acquire shares or voting rights in, or control over the target company. (2) Such public announcement,— (a) in the case of market purchases, shall be made prior to placement of the purchase order with the stock broker to acquire the shares, that would take the entitlement to voting rights beyond the stipulated thresholds; (b) pursuant to an acquirer acquiring shares or voting rights in, or control over the target company upon converting convertible securities without a fixed date of conversion or upon conversion of depository receipts for the underlying shares of the target company shall be made on the same day as the date of exercise of the option to convert such securities into shares of the target company; (c) pursuant to an acquirer acquiring shares or voting rights in, or control over the target company upon conversion of convertible securities with a fixed date of conversion shall be made on the second working day preceding the scheduled date of conversion of such securities into shares of the target company; (d) pursuant to a disinvestment shall be made on the same day as the date of executing the agreement for acquisition of shares or voting rights in or control over the target company; (e) in the case of indirect acquisition of shares or voting rights in, or control over the target company where none of the parameters referred to in sub-regulation (2) of regulation 5 are met, may be made at any time within four working days from the earlier of, the date on which the primary acquisition is contracted, and the date on Page 44 of 79 which the intention or the decision to make the primary acquisition is announced in the public domain; (f) in the case of indirect acquisition of shares or voting rights in, or control over the target company where any of the parameters referred to in sub-regulation (2) of regulation 5 are met shall be made on the earlier of, the date on which the primary acquisition is contracted, and the date on which the intention or the decision to make the primary acquisition is announced in the public domain; (g) pursuant to an acquirer acquiring shares or voting rights in, or control over the target company, under preferential issue, shall be made on the date on which 74[the board of directors of the target company authorises such preferential issue.]; (h) the public announcement pursuant to an increase in voting rights consequential to a buy-back not qualifying for exemption under regulation 10, shall be made not later than the ninetieth day from the date of 75[closure of the buy-back offer by the target company].; (i) the public announcement pursuant to any acquisition of shares or voting rights in or control over the target company where the specific date on which title to such shares, voting rights or control is acquired is beyond the control of the acquirer, shall be made not later than two working days from the date of receipt of intimation of having acquired such title. 76 [(2A) Notwithstanding anything contained in sub-regulation (2), a public announcement referred to in regulation 3 and regulation 4 for a proposed acquisition of shares or voting rights in or control over the target company through a combination of,- (i) an agreement and any one or more modes of acquisition referred to in sub- regulation (2) of regulation 13, or 74 Substituted for “special resolution is passed for allotment of shares under sub-section (1A) of section 81 of the Companies Act, 1956” by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. 75 Substituted for “such increase in the voting rights beyond the relevant threshold stipulated in regulation 3” by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. 76Inserted by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. Page 45 of 79 (ii) any one or more modes of acquisition referred in clause (a) to (i) of sub- regulation (2) of regulation 13, shall be made on the date of first such acquisition, provided the acquirer discloses in the public announcement the details of the proposed subsequent acquisition.] (3) The public announcement made under regulation 6 shall be made on the same day as the date on which the acquirer takes the decision to voluntarily make a public announcement of an open offer for acquiring shares of the target company. (4) Pursuant to the public announcement made under sub-regulation (1) and sub- regulation (3), a detailed public statement shall be published by the acquirer through the manager to the open offer in accordance with regulation 14 and regulation 15, not later than five working days of the public announcement: Provided that the detailed public statement pursuant to a public announcement made under clause (e) of sub-regulation (2) shall be made not later than five working days of the completion of the primary acquisition of shares or voting rights in, or control over the company or entity holding shares or voting rights in, or control over the target company. Explanation.— It is clarified that in the event the acquirer does not succeed in acquiring the ability to exercise or direct the exercise of voting rights in, or control over the target company, the acquirer shall not be required to make a detailed public statement of an open offer for acquiring shares under these regulations. Publication. 14. (1) The public announcement shall be sent to all the stock exchanges on which the shares of the target company are listed, and the stock exchanges shall forthwith disseminate such information to the public. (2) A copy of the public announcement shall be sent to the Board and to the target company at its registered office within one working day of the date of the public announcement. (3) The detailed public statement pursuant to the public announcement referred to in sub-regulation (4) of regulation 13 shall be published in all editions of any one English national daily with wide circulation, any one Hindi national daily Page 46 of 79 with wide circulation, and any one regional language daily with wide circulation at the place where the registered office of the target company is situated and one regional language daily at the place of the stock exchange where the maximum volume of trading in the shares of the target company are recorded during the sixty trading days preceding the date of the public announcement. (4) Simultaneously with publication of such detailed public statement in the newspapers, a copy of the same shall be sent to,— (i) the Board through the manager to the open offer, (ii) all the stock exchanges on which the shares of the target company are listed, and the stock exchanges shall forthwith disseminate such information to the public, (iii) the target company at its registered office, and the target company shall forthwith circulate it to the members of its board. Contents. 15. (1) The public announcement shall contain such information as may be specified, including the following,— (a) name and identity of the acquirer and persons acting in concert with him; (b) name and identity of the sellers, if any; (c) nature of the proposed acquisition such as purchase of shares or allotment of shares, or any other means of acquisition of shares or voting rights in, or control over the target company; (d) the consideration for the proposed acquisition that attracted the obligation to make an open offer for acquiring shares, and the price per share, if any; (e) the offer price, and mode of payment of consideration; 77[***] (f) offer size, and conditions as to minimum level of acceptances, 78[if any; and] 79[(g) intention of the acquirer to either delist the target company or retain the listing of the target company. In case of proposed delisting under regulation 77 The word “and” omitted by Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. 78 Substituted for “if any.” by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. 79 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Page 47 of 79 5A, the proposed open offer price and indicative price as required under regulation 5A shall be disclosed along with an explanation setting out the rationale and basis for justifying the indicative price.] (2) The detailed public statement pursuant to the public announcement shall contain such information as may be specified in order to enable shareholders to make an informed decision with reference to the open offer. (3) The public announcement of the open offer, the detailed public statement, and any other statement, advertisement, circular, brochure, publicity material or letter of offer issued in relation to the acquisition of shares under these regulations shall not omit any relevant information, or contain any misleading information. Filing of letter of offer with the Board. 16. (1) Within five working days from the date of the detailed public statement made under sub-regulation (4) of regulation 13, the acquirer shall, through the manager to the open offer, file with the Board, a draft of the letter of offer containing such information as may be specified along with a non-refundable fee, as per the following scale, 80[by way of direct credit in the bank account through NEFT/RTGS/IMPS or]81[ online payment using the SEBI Payment Gateway or any other mode as may be specified by the Board from time to time],— 82[ 80 Inserted by the SEBI (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2017, w.e.f. 6-3-2017. 81 Substituted by the SEBI (Payment of fees) (Amendment) Regulations, 2023 w.e.f. 01-04-2023 for the words “any other mode allowed by RBI or by way of a banker’s cheque or demand draft payable in Mumbai in favour of the Board” 82 Substituted by the SEBI (Payment of fees) (Amendment) Regulations, 2014 w.e.f. 23-05-2014. Prior to its substitution, the table in sub-regulation (1), read as under, “ Sl. No. Consideration payable under the Open Offer Fee (Rs.) a. Upto ten crore rupees. One lakh twenty five thousands rupees ( 1,25,000) b. More than ten crore rupees, but less than or equal to one thousand crore rupees. One lakh twenty five thousands rupees ( 1,25,000) plus 0.025 per cent of the portion Page 48 of 79 Sl. No. Consideration payable under the Open Offer Fee (Rs.) a. Upto ten crore rupees. Five lakh rupees (Rs. 5,00,000) b. More than ten crore rupees, but less than or equal to one thousand crore rupees. 0.5 per cent of the offer size c. More than one thousand crore rupees. Five crore rupees (Rs. 5,00,00,000) plus 0.125 per cent of the portion of the offer size in excess of one thousand crore rupees (1000,00,00,000). ] (2) The consideration payable under the open offer shall be calculated at the offer price, assuming full acceptance of the open offer, and in the event the open offer is subject to differential pricing, shall be computed at the highest offer price, irrespective of manner of payment of the consideration: Provided that in the event of consideration payable under the open offer being enhanced owing to a revision to the offer price or offer size the fees payable shall stand revised accordingly, and shall be paid within five working days from the date of such revision. of the offer size in excess of ten crore rupees ( 10,00,00,000). c. More than one thousand crore rupees, but less than or equal to five thousand crore rupees. One crore twenty five lakh rupees ( 1,25,00,000) plus 0.03125 per cent of the portion of the offer size in excess of one thousand crore rupees ( 1000,00,00,000). d. More than five thousand crore rupees. Two crore fifty lakh rupees ( 2,50,00,000) plus 0.01 per cent of the portion of the offer size in excess of five thousand crore rupees ( 5000,00,00,000), subject to a maximum of three crore rupees ( 3,00,00,000). “. Page 49 of 79 (3) The manager to the open offer shall provide soft copies of the public announcement, the detailed public statement and the draft letter of offer in accordance with such specifications as may be specified, and the Board shall upload the same on its website. (4) The Board shall give its comments on the draft letter of offer as expeditiously as possible but not later than fifteen working days of the receipt of the draft letter of offer and in the event of no comments being issued by the Board within such period, it shall be deemed that the Board does not have comments to offer: Provided that in the event the Board has sought clarifications or additional information from the manager to the open offer, the period for issuance of comments shall be extended to the fifth working day from the date of receipt of satisfactory reply to the clarification or additional information sought. Provided further that in the event the Board specifies any changes, the manager to the open offer and the acquirer shall carry out such changes in the letter of offer before it is dispatched to the shareholders. (5) In the case of competing offers, the Board shall provide its comments on the draft letter of offer in respect of each competing offer on the same day. (6) In the event the disclosures in the draft letter of offer are inadequate the Board may call for a revised letter of offer and shall deal with the revised letter of offer in accordance with sub-regulation (4). Provision of escrow. 17. (1) Not later than two working days prior to the date of the detailed public statement of the open offer for acquiring shares, the acquirer shall create an escrow account towards security for performance of his obligations under these regulations, and deposit in escrow account such aggregate amount as per the following scale: Sl. No. Consideration payable under the Open Offer Escrow Amount a. On the first five hundred crore rupees an amount equal to twenty-five per cent of the consideration b. On the balance consideration an additional amount equal to ten per cent of the balance consideration Page 50 of 79 Provided that where an open offer is made conditional upon minimum level of acceptance, hundred percent of the consideration payable in respect of minimum level of acceptance or fifty per cent of the consideration payable under the open offer, whichever is higher, shall be deposited in cash in the escrow account. 83[Provided further that in case of indirect acquisitions where public announcement has been made in terms of clause (e) of sub-regulation (2) of regulation 13 of these regulations, an amount equivalent to hundred per cent of the consideration payable in the open offer shall be deposited in the escrow account.] (2) The consideration payable under the open offer shall be computed as provided for in sub-regulation (2) of regulation 16 and in the event of an upward revision of the offer price or of the offer size, the value of the escrow amount shall be computed on the revised consideration calculated at such revised offer price, and the additional amount shall be brought into the escrow account prior to effecting such revision. (3) The escrow account referred to in sub-regulation (1) may be in the form of,— (a) cash deposited with any scheduled commercial bank; (b) bank guarantee issued in favour of the manager to the open offer by any scheduled commercial bank; or (c) deposit of frequently traded and freely transferable equity shares or other freely transferable securities with appropriate margin: Provided that securities sought to be provided towards escrow account under clause (c) shall be required to conform to the requirements set out in sub-regulation (2) of regulation 9. 84[Provided further that the deposit of securities shall not be permitted in respect of indirect acquisitions where public announcement has been made in terms of clause (e) of sub-regulation (2) of regulation 13 of these regulations] 85[Explanation: The cash component of the escrow account as referred to in clause (a) above may be maintained in an interest bearing account, subject to 83 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2020, w.e.f. 01-07-2020. 84 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2020, w.e.f. 01-07-2020. 85 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Page 51 of 79 the merchant banker ensuring that the funds are available at the time of making payment to the shareholders.] (4) In the event of the escrow account being created by way of a bank guarantee or by deposit of securities, the acquirer shall also ensure that at least one per cent of the total consideration payable is deposited in cash with a scheduled commercial bank as a part of the escrow account. (5) For such part of the escrow account as is in the form of a cash deposit with a scheduled commercial bank, the acquirer shall while opening the account, empower the manager to the open offer to instruct the bank to issue a banker’s cheque or demand draft or to make payment of the amounts lying to the credit of the escrow account, in accordance with requirements under these regulations. (6) For such part of the escrow account as is in the form of a bank guarantee, such bank guarantee shall be in favour of the manager to the open offer and shall be kept valid throughout the offer period and for an additional period of thirty days after completion of payment of consideration to shareholders who have tendered their shares in acceptance of the open offer. (7) For such part of the escrow account as is in the form of securities, the acquirer shall empower the manager to the open offer to realise the value of such escrow account by sale or otherwise, and in the event there is any shortfall in the amount required to be maintained in the escrow account, the manager to the open offer shall be liable to make good such shortfall. (8) The manager to the open offer shall not release the escrow account until the expiry of thirty days from the completion of payment of consideration to shareholders who have tendered their shares in acceptance of the open offer, save and except for transfer of funds to the special escrow account as required under regulation 21. (9) In the event of non-fulfillment of obligations under these regulations by the acquirer the Board may direct the manager to the open offer to forfeit the escrow account or any amounts lying in the special escrow account, either in full or in part. (10) The escrow account deposited with the bank in cash shall be released only in the following manner,— (a) the entire amount to the acquirer upon withdrawal of offer in terms of regulation 23 as certified by the manager to the open offer: Page 52 of 79 Provided that in the event the withdrawal is pursuant to clause (c) of sub-regulation (1) of regulation 23, the manager to the open offer shall release the escrow account upon receipt of confirmation of such release from the Board; (b) for transfer of an amount not exceeding ninety per cent of the escrow account, to the special escrow account in accordance with regulation 21; (c) to the acquirer, the balance of the escrow account after transfer of cash to the special escrow account, on the expiry of thirty days from the completion of payment of consideration to shareholders who have tendered their shares in acceptance of the open offer, as certified by the manager to the open offer; (d) the entire amount to the acquirer upon the expiry of thirty days from the completion of payment of consideration to shareholders who have tendered their shares in acceptance of the open offer, upon certification by the manager to the open offer, where the open offer is for exchange of shares or other secured instruments; (e) the entire amount to the manager to the open offer, in the event of forfeiture for non-fulfillment of any of the obligations under these regulations, for distribution in the following manner, after deduction of expenses, if any, of registered market intermediaries associated with the open offer,— (i) one third of the escrow account to the target company; (ii) one third of the escrow account to the Investor Protection and Education Fund established under the Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009; and (iii) one third of the escrow account to be distributed pro-rata among the shareholders who have accepted the open offer. Other procedures. 18. (1) Simultaneously with the filing of the draft letter of offer with the Board under sub-regulation (1) of regulation 16, the acquirer shall send a copy of the draft letter of offer to the target company at its registered office address and to all stock exchanges where the shares of the target company are listed. Page 53 of 79 (2) The letter of offer shall be dispatched to the shareholders whose names appear on the register of members of the target company as of the identified date, not later than seven working days from the receipt of comments from the Board or where no comments are offered by the Board, within seven working days from the expiry of the period stipulated in sub-regulation (4) of regulation 16: 86[Explanation: (i) Letter of offer may also be dispatched through electronic mode in accordance with the provisions of Companies Act, 2013. (ii) On receipt of a request from any shareholder to receive a copy of the letter of offer in physical format, the same shall be provided. (iii) The aforesaid shall be disclosed in the letter of offer.] Provided that where local laws or regulations of any jurisdiction outside India may expose the acquirer or the target company to material risk of civil, regulatory or criminal liabilities in the event the letter of offer in its final form were to be sent without material amendments or modifications into such jurisdiction, and the shareholders resident in such jurisdiction hold shares entitling them to less than five per cent of the voting rights of the target company, the acquirer may refrain from dispatch of the letter of offer into such jurisdiction: Provided further that every person holding shares, regardless of whether he held shares on the identified date or has not received the letter of offer, shall be entitled to tender such shares in acceptance of the open offer. (3) Simultaneously with the dispatch of the letter of offer in terms of sub- regulation (2), the acquirer shall send the letter of offer to the custodian of shares underlying depository receipts, if any, of the target company. (4) Irrespective of whether a competing offer has been made, an acquirer may make upward revisions to the offer price, and subject to the other provisions of these regulations, to the number of shares sought to be acquired under the open offer, at any time prior to the commencement of the last 87[one working day] before the commencement of the tendering period. 86 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. 87 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “three working days”. Page 54 of 79 (5) In the event of any revision of the open offer, whether by way of an upward revision in offer price, or of the offer size, the acquirer shall,— (a) make corresponding increases to the amount kept in escrow account under regulation 17 prior to such revision; (b) make an announcement in respect of such revisions in all the newspapers in which the detailed public statement pursuant to the public announcement was made; and (c) simultaneously with the issue of such an announcement, inform the Board, all the stock exchanges on which the shares of the target company are listed, and the target company at its registered office. (6) The acquirer shall disclose during the offer period every acquisition made by the acquirer or persons acting in concert with him of any shares of the target company in such form as may be specified, to each of the stock exchanges on which the shares of the target company are listed and to the target company at its registered office within twenty-four hours of such acquisition, and the stock exchanges shall forthwith disseminate such information to the public: Provided that the acquirer and persons acting in concert with him shall not acquire or sell any shares of the target company during the period between three working days prior to the commencement of the tendering period and until the expiry of the tendering period. 88[(6A) The acquirer shall facilitate tendering of shares by the shareholders and settlement of the same, through the stock exchange mechanism as specified by the Board.] (7) The acquirer shall issue an advertisement in such form as may be specified, one working day before the commencement of the tendering period, announcing the schedule of activities for the open offer, the status of statutory and other approvals, if any, whether for the acquisition attracting the obligation to make an open offer under these regulations or for the open offer, unfulfilled conditions, if any, and their status, the procedure for tendering acceptances and such other material detail as may be specified: 88 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2015, w.e.f. 24-03-2015. Page 55 of 79 Provided that such advertisement shall be,— (a) published in all the newspapers in which the detailed public statement pursuant to the public announcement was made; and (b) simultaneously sent to the Board, all the stock exchanges on which the shares of the target company are listed, and the target company at its registered office. (8) The tendering period shall start not later than twelve working days from date of receipt of comments from the Board under sub-regulation (4) of regulation 16 and shall remain open for ten working days. (9) Shareholders who have tendered shares in acceptance of the open offer shall not be entitled to withdraw such acceptance during the tendering period. (10) The acquirer shall, within ten working days from the last date of the tendering period, complete all requirements under these regulations and other applicable law relating to the open offer including payment of consideration to the shareholders who have accepted the open offer. (11) The acquirer shall be responsible to pursue all statutory approvals required by the acquirer in order to complete the open offer without any default, neglect or delay: Provided that where the acquirer is unable to make the payment to the shareholders who have accepted the open offer within such period owing to non-receipt of statutory approvals required by the acquirer, the Board may, where it is satisfied that such non-receipt was not attributable to any willful default, failure or neglect on the part of the acquirer to diligently pursue such approvals, grant extension of time for making payments, subject to the acquirer agreeing to pay interest to the shareholders for the delay at such rate as may be specified: Provided further that where the statutory approval extends to some but not all shareholders, the acquirer shall have the option to make payment to such shareholders in respect of whom no statutory approvals are required in order to complete the open offer. Page 56 of 79 89[(11A) Without prejudice to sub-regulation 11, in case the acquirer is unable to make payment to the shareholders who have accepted the open offer within such period, the acquirer shall pay interest for the period of delay to all such shareholders whose shares have been accepted in the open offer, at the rate of ten per cent per annum: Provided that in case the delay was not attributable to any act of omission or commission of the acquirer, or due to the reasons or circumstances beyond the control of acquirer, the Board may grant waiver from the payment of interest. Provided further that the payment of interest would be without prejudice to the Board taking any action under regulation 32 of these regulation or under the Act.] (12) (a) The acquirer shall issue a post offer advertisement in such form as may be specified within five working days after the offer period, giving details including aggregate number of shares tendered, accepted, date of payment of consideration. (b) Such advertisement shall be,— (i) published in all the newspapers in which the detailed public statement pursuant to the public announcement was made; and (ii) simultaneously sent to the Board, all the stock exchanges on which the shares of the target company are listed, and the target company at its registered office. Conditional offer. 19. (1) An acquirer may make an open offer conditional as to the minimum level of acceptance: Provided that where the open offer is pursuant to an agreement, such agreement shall contain a condition to the effect that in the event the desired level of acceptance of the open offer is not received the acquirer shall not acquire any shares under the open offer and the agreement attracting the obligation to make the open offer shall stand rescinded. 89 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2020, w.e.f. 01-07-2020. Page 57 of 79 (2) Where an open offer is made conditional upon minimum level of acceptances, the acquirer and persons acting in concert with him shall not acquire, during the offer period, any shares in the target company except under the open offer and any underlying agreement for the sale of shares of the target company pursuant to which the open offer is made. Competing offers. 20. (1) Upon a public announcement of an open offer for acquiring shares of a target company being made, any person, other than the acquirer who has made such public announcement, shall be entitled to make a public announcement of an open offer within fifteen working days of the date of the detailed public statement made by the acquirer who has made the first public announcement. (2) The open offer made under sub-regulation (1) shall be for such number of shares which, when taken together with shares held by such acquirer along with persons acting in concert with him, shall be at least equal to the holding of the acquirer who has made the first public announcement, including the number of shares proposed to be acquired by him under the offer and any underlying agreement for the sale of shares of the target company pursuant to which the open offer is made. (3) Notwithstanding anything contained in these regulations, an open offer made within the period referred to in sub-regulation (1) shall not be regarded as a voluntary open offer under regulation 6, and the provisions of these regulations shall apply accordingly. (4) Every open offer made under sub-regulation (1) and the open offer first made shall be regarded as competing offers for purposes of these regulations. (5) No person shall be entitled to make a public announcement of an open offer for acquiring shares, or enter into any transaction that would attract the obligation to make a public announcement of an open offer for acquiring shares under these regulations, after the period of fifteen working days referred to in sub-regulation (1) and until the expiry of the offer period for such open offer. (6) Unless the open offer first made is an open offer conditional as to the minimum level of acceptances, no acquirer making a competing offer may be made conditional as to the minimum level of acceptances. Page 58 of 79 (7) No person shall be entitled to make a public announcement of an open offer for acquiring shares, or enter into any transaction that would attract the obligation to make a public announcement of an open offer under these regulations until the expiry of the offer period where,— (a) the open offer is for acquisition of shares pursuant to disinvestment, in terms of clause (d) of sub-regulation (2) of regulation 13; or (b) the open offer is pursuant to a relaxation from strict compliance with the provisions of Chapter III or Chapter IV granted by the Board under sub- regulation (2) of regulation 11. (8) The schedule of activities and the tendering period for all competing offers shall be carried out with identical timelines and the last date for tendering shares in acceptance of the every competing offer shall stand revised to the last date for tendering shares in acceptance of the competing offer last made. (9) Upon the public announcement of a competing offer, an acquirer who had made a preceding competing offer shall be entitled to revise the terms of his open offer provided the revised terms are more favourable to the shareholders of the target company: Provided that the acquirers making the competing offers shall be entitled to make upward revisions of the offer price at any time up to 90[one working day] prior to the commencement of the tendering period. (10) Except for variations made under this regulation, all the provisions of these regulations shall apply to every competing offer. Payment of consideration. 21.(1) For the amount of consideration payable in cash, the acquirer shall open a special escrow account with a banker to an issue registered with the Board and deposit therein, such sum as would, together with cash transferred under clause (b) of sub-regulation (10) of regulation 17, make up the entire sum due and payable to the shareholders as consideration payable under the open offer, and empower the manager to the offer to operate the special escrow account on behalf of the acquirer for the purposes under these regulations. 90 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “three working days”. Page 59 of 79 (2) Subject to provisos to sub-regulation (11) of regulation 18, the acquirer shall complete payment of consideration whether in the form of cash, or as the case may be, by issue, exchange or transfer of securities, to all shareholders who have tendered shares in acceptance of the open offer, within ten working days of the expiry of the tendering period. (3) Unclaimed balances, if any, lying to the credit of the special escrow account referred to in sub-regulation (1) at the end of seven years from the date of deposit thereof, shall be transferred to the Investor Protection and Education Fund established under the Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009. Completion of acquisition. 22.(1) The acquirer shall not complete the acquisition of shares or voting rights in, or control over, the target company, whether by way of subscription to shares or a purchase of shares attracting the obligation to make an open offer for acquiring shares, until the expiry of the offer period: 91 [Provided that in case of an offer made under sub-regulation (1) of regulation 20 of these regulations, pursuant to a preferential allotment, the offer shall be completed within the period as provided under sub-regulation (1) of regulation 170 of the Securities and Exchange Board of India (Issue of Capital and Disclosure requirements) Regulations, 2018, subject to the non- obstante clause in sub-regulation (4) of regulation 7 of these regulations.] 92[Provided further that in case of a delisting offer made under regulation 5A, the acquirer shall complete the acquisition of shares attracting the obligation to make an offer for acquiring shares in terms of 93[sub-regulation (1) of regulation 3, regulation 4 or regulation 5], only after making the public 91 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Before substitution, the proviso read as follows: “Provided that in case of an offer made under sub-regulation (1) of regulation 20, pursuant to a preferential allotment, the offer shall be completed within the period as provided under sub-regulation (1) of regulation 74 of Securities and Exchange Board of India (Issue of Capital and Disclosure) Regulations, 2009.” 92 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2015, w.e.f. 24-03-2015. 93 Substituted for “regulations 3, 4 or 5” by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. Page 60 of 79 announcement regarding the success of the delisting proposal made in terms of 94[sub-regulation (4) of regulation 17 of the Delisting Regulations].] (2) Notwithstanding anything contained in sub-regulation (1), subject to the acquirer depositing in the escrow account under regulation 17, cash 95[or providing unconditional and irrevocable bank guarantee issued in favour of the manager to the open offer by any scheduled commercial bank, subject to the approval of the Reserve Bank of India,] of an amount equal to 96[the entire] consideration payable under the open offer assuming full acceptance of the open offer, the parties to such agreement may after the expiry of twenty-one working days from the date of detailed public statement, act upon the agreement and the acquirer may complete the acquisition of shares or voting rights in, or control over the target company as contemplated. 97[ Explanation. - For the purpose of sub-regulation (2), bank guarantee shall only be issued by such scheduled commercial bank having ‘AAA’ rating from a credit rating agency registered with the Board, on any of its long term debt instrument.] 98[Provided that in case of proportionate reduction of the shares or voting rights to be acquired in accordance with the relevant provision under sub- regulation (4) of regulation 7, the acquirer shall undertake the completion of the scaled down acquisition of shares or voting rights in the target company.] 99[(2A) Notwithstanding anything contained in sub-regulation (1), an acquirer may acquire shares of the target company through preferential issue or through the stock exchange settlement process, 100[***] subject to,- 94 Substituted for “sub-regulation (1) regulation 18 of Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009” by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. 95 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2022, w.e.f. 9-11-2022. 96 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “one hundred per cent of the”. 97 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2022, w.e.f. 9-11-2022. 98 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021, w.e.f. 6-12-2021. 99Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. 100 Words “other than through bulk deals or block deals,” omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2020, w.e.f 01-07-2020. Page 61 of 79 (i) such shares being kept in an escrow account, (ii) the acquirer not exercising any voting rights over such shares kept in the escrow account: Provided that such shares may be transferred to the account of the acquirer, subject to the acquirer complying with requirements specified in sub- regulation (2).] (3) The acquirer shall complete the acquisitions contracted under any agreement attracting the obligation to make an open offer not later than twenty-six weeks from the expiry of the offer period: Provided that in the event of any extraordinary and supervening circumstances rendering it impossible to complete such acquisition within such period, the Board may for reasons to be published, may grant an extension of time by such period as it may deem fit in the interests of investors in securities and the securities market. Withdrawal of open offer. 23.(1) An open offer for acquiring shares once made shall not be withdrawn except under any of the following circumstances,— (a) statutory approvals required for the open offer or for effecting the acquisitions attracting the obligation to make an open offer under these regulations having been finally refused, subject to such requirements for approval having been specifically disclosed in the detailed public statement and the letter of offer; (b) the acquirer, being a natural person, has died; (c) any condition stipulated in the agreement for acquisition attracting the obligation to make the open offer is not met for reasons outside the reasonable control of the acquirer, and such agreement is rescinded, subject to such conditions having been specifically disclosed in the detailed public statement and the letter of offer; or 101[Provided that an acquirer shall not withdraw an open offer pursuant to a public announcement made under clause (g) of sub-regulation (2) of 101 Inserted by the SEBI(Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. Page 62 of 79 regulation 13, even if the proposed acquisition through the preferential issue is not successful.] (d) such circumstances as in the opinion of the Board, merit withdrawal. Explanation.— For the purposes of clause (d) of sub-regulation (1), the Board shall pass a reasoned order permitting withdrawal, and such order shall be hosted by the Board on its official website. (2) In the event of withdrawal of the open offer, the acquirer shall through the manager to the open offer, within two working days,— (a) make an announcement in the same newspapers in which the public announcement of the open offer was published, providing the grounds and reasons for withdrawal of the open offer; and (b) simultaneously with the announcement, inform in writing to,— (i) the Board; (ii) all the stock exchanges on which the shares of the target company are listed, and the stock exchanges shall forthwith disseminate such information to the public; and (iii) the target company at its registered office. CHAPTER - IV OTHER OBLIGATIONS Directors of the target company. 24.(1) During the offer period, no person representing the acquirer or any person acting in concert with him shall be appointed as director on the board of directors of the target company, whether as an additional director or in a casual vacancy: Provided that after an initial period of fifteen working days from the date of detailed public statement, appointment of persons representing the acquirer or persons acting in concert with him on the board of directors may be effected in the event the acquirer deposits in cash in the escrow account referred to in regulation 17, 102[the entire] consideration payable under the open offer: 102 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “one hundred per cent of the”. Page 63 of 79 Provided further that where the acquirer has specified conditions to which the open offer is subject in terms of clause (c) of sub-regulation (1) of regulation 23, no director representing the acquirer may be appointed to the board of directors of the target company during the offer period unless the acquirer has waived or attained such conditions and complies with the requirement of depositing cash in the escrow account. (2) Where an open offer is made conditional upon minimum level of acceptances, the acquirer and persons acting in concert shall, notwithstanding anything contained in these regulations, and regardless of the size of the cash deposited in the escrow account referred to regulation 17, not be entitled to appoint any director representing the acquirer or any person acting in concert with him on the board of directors of the target company during the offer period. (3) During the pendency of competing offers, notwithstanding anything contained in these regulations, and regardless of the size of the cash deposited in the escrow account referred to in regulation 17, by any acquirer or person acting in concert with him, there shall be no induction of any new director to the board of directors of the target company: Provided that in the event of death or incapacitation of any director, the vacancy arising therefrom may be filled by any person subject to approval of such appointment by shareholders of the target company by way of a postal ballot. (4) In the event the acquirer or any person acting in concert is already represented by a director on the board of the target company, such director shall not participate in any deliberations of the board of directors of the target company or vote on any matter in relation to the open offer. Obligations of the acquirer. 25(1) Prior to making the public announcement of an open offer for acquiring shares under these regulations, the acquirer shall ensure that firm financial arrangements have been made for fulfilling the payment obligations under the open offer and that the acquirer is able to implement the open offer, subject to any statutory approvals for the open offer that may be necessary. (2) In the event the acquirer has not declared an intention in the detailed public statement and the letter of offer to alienate any material assets of the target company or of any of its subsidiaries whether by way of sale, lease, encumbrance or otherwise Page 64 of 79 outside the ordinary course of business, the acquirer, where he has acquired control over the target company, shall be debarred from causing such alienation for a period of two years after the offer period: Provided that in the event the target company or any of its subsidiaries is required to so alienate assets despite the intention to alienate not having been expressed by the acquirer, such alienation shall require a special resolution passed by shareholders of the target company, by way of a postal ballot and the notice for such postal ballot shall inter alia contain reasons as to why such alienation is necessary. (3) The acquirer shall ensure that the contents of the public announcement, the detailed public statement, the letter of offer and the post-offer advertisement are true, fair and adequate in all material aspects and not misleading in any material particular, and are based on reliable sources, and state the source wherever necessary. (4) The acquirer and persons acting in concert with him shall not sell shares of the target company held by them, during the offer period. (5) The acquirer and persons acting in concert with him shall be jointly and severally responsible for fulfillment of applicable obligations under these regulations. Obligations of the target company. 26.(1) Upon a public announcement of an open offer for acquiring shares of a target company being made, the board of directors of such target company shall ensure that during the offer period, the business of the target company is conducted in the ordinary course consistent with past practice. (2) During the offer period, unless the approval of shareholders of the target company by way of a special resolution by postal ballot is obtained, the board of directors of either the target company or any of its subsidiaries shall not,— (a) alienate any material assets whether by way of sale, lease, encumbrance or otherwise or enter into any agreement therefor outside the ordinary course of business; (b) effect any material borrowings outside the ordinary course of business; (c) issue or allot any authorised but unissued securities entitling the holder to voting rights: Page 65 of 79 Provided that the target company or its subsidiaries may,— (i) issue or allot shares upon conversion of convertible securities issued prior to the public announcement of the open offer, in accordance with pre-determined terms of such conversion; (ii) issue or allot shares pursuant to any public issue in respect of which the red herring prospectus has been filed with the Registrar of Companies prior to the public announcement of the open offer; or (iii)issue or allot shares pursuant to any rights issue in respect of which the record date has been announced prior to the public announcement of the open offer; (d) implement any buy-back of shares or effect any other change to the capital structure of the target company; (e) enter into, amend or terminate any material contracts to which the target company or any of its subsidiaries is a party, outside the ordinary course of business, whether such contract is with a related party, within the meaning of the term under applicable accounting principles, or with any other person; and (f) accelerate any contingent vesting of a right of any person to whom the target company or any of its subsidiaries may have an obligation, whether such obligation is to acquire shares of the target company by way of employee stock options or otherwise. (3) In any general meeting of a subsidiary of the target company in respect of the matters referred to in sub-regulation (2), the target company and its subsidiaries, if any, shall vote in a manner consistent with the special resolution passed by the shareholders of the target company. (4) The target company shall be prohibited from fixing any record date for a corporate action on or after the third working day prior to the commencement of the tendering period and until the expiry of the tendering period. (5) The target company shall furnish to the acquirer within two working days from the identified date, a list of shareholders as per the register of members of the target company containing names, addresses, shareholding and folio number, in electronic form, wherever available, and a list of persons whose applications, if any, for registration of transfer of shares are pending with the target company: Page 66 of 79 Provided that the acquirer shall reimburse reasonable costs payable by the target company to external agencies in order to furnish such information. (6) Upon receipt of the detailed public statement, the board of directors of the target company shall constitute a committee of independent directors to provide reasoned recommendations on such open offer, and the target company shall publish such recommendations: Provided that such committee shall be entitled to seek external professional advice at the expense of the target company. 103[Provided further that while providing reasoned recommendations on the open offer proposal, the committee shall disclose the voting pattern of the meeting in which the open offer proposal was discussed.] (7) The committee of independent directors shall provide its written reasoned recommendations on the open offer to the shareholders of the target company and such recommendations shall be published in such form as may be specified, at least two working days before the commencement of the tendering period, in the same newspapers where the public announcement of the open offer was published, and simultaneously, a copy of the same shall be sent to,— (i) the Board; (ii) all the stock exchanges on which the shares of the target company are listed, and the stock exchanges shall forthwith disseminate such information to the public; and (iii) to the manager to the open offer, and where there are competing offers, to the manager to the open offer for every competing offer. (8) The board of directors of the target company shall facilitate the acquirer in verification of shares tendered in acceptance of the open offer. (9) The board of directors of the target company shall make available to all acquirers making competing offers, any information and co-operation provided to any acquirer who has made a competing offer. (10) Upon fulfillment by the acquirer, of the conditions required under these regulations, the board of directors of the target company shall without any delay register the 103Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021, w.e.f. 05-05-2021. Page 67 of 79 transfer of shares acquired by the acquirer in physical form, whether under the agreement or from open market purchases, or pursuant to the open offer. Obligations of the manager to the open offer. 27.(1) Prior to public announcement being made, the manager to the open offer shall ensure that,— (a) the acquirer is able to implement the open offer; and (b) firm arrangements for funds through verifiable means have been made by the acquirer to meet the payment obligations under the open offer. (2) The manager to the open offer shall ensure that the contents of the public announcement, the detailed public statement and the letter of offer and the post- offer advertisement are true, fair and adequate in all material aspects, not misleading in any material particular, are based on reliable sources, state the source wherever necessary, and are in compliance with the requirements under these regulations. (3) The manager to the open offer shall furnish to the Board a due diligence certificate along with the draft letter of offer filed under regulation 16. (4) The manager to the open offer shall ensure that market intermediaries engaged for the purposes of the open offer are registered with the Board. (5) The manager to the open offer shall exercise diligence, care and professional judgment to ensure compliance with these regulations. (6) The manager to the open offer shall not deal on his own account in the shares of the target company during the offer period. (7) The manager to the open offer shall file a report with the Board within fifteen working days from the expiry of the tendering period, in such form as may be specified, confirming status of completion of various open offer requirements. CHAPTER - V DISCLOSURES OF SHAREHOLDING AND CONTROL Disclosure-related provisions. 28.(1) The disclosures under this Chapter shall be of the aggregated shareholding and voting rights of the acquirer or promoter of the target company or every person acting in concert with him. Page 68 of 79 (2) For the purposes of this Chapter, the acquisition and holding of any convertible security shall also be regarded as shares, and disclosures of such acquisitions and holdings shall be made accordingly. 104[(3) For the purposes of this Chapter, the term “encumbrance” shall include,- (a) any restriction on the free and marketable title to shares, by whatever name called, whether executed directly or indirectly; (b) pledge, lien, negative lien, non-disposal undertaking; or (c) any covenant, transaction, condition or arrangement in the nature of encumbrance, by whatever name called, whether executed directly or indirectly.] (4) Upon receipt of the disclosures required under this Chapter, the stock exchange shall forthwith disseminate the information so received. Disclosure of acquisition and disposal. 29.(1) 105[Any acquirer, together with persons acting in concert with him acquiring shares or voting rights in a target company, which taken together aggregates to five per cent or more of the shares of such target company, shall disclose their aggregate shareholding and voting rights in such target company in such form as may be specified:] 106[Provided that in case of listed entity which has listed its specified securities on Innovators Growth Platform, any reference to “five per cent” shall be read as “ten per cent”] 104 Sub-regulation (3) substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2019, w.e.f. 29-07-2019. Prior to its substitution it read as follows,- “(3) For the purposes of this Chapter, the term “encumbrance” shall include a pledge, lien or any such transaction, by whatever name called.” 105 Substituted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021, w.e.f. 1-4-2022. Prior to its substitution, sub- regulation (1) read as under: “(1) Any acquirer who acquires shares or voting rights in a target company which taken together with shares or voting rights, if any, held by him and by persons acting in concert with him in such target company, aggregating to five per cent or more of the shares of such target company, shall disclose their aggregate shareholding and voting rights in such target company in such form as may be specified:” 106 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021, w.e.f. 05-05-2021. Page 69 of 79 107[(2) 108[Any person together] with persons acting in concert with him, holds shares or voting rights entitling them to five per cent or more of the shares or voting rights in a target company, shall disclose the number of shares or voting rights held and change in shareholding or voting rights, even if such change results in shareholding falling below five per cent, if there has been change in such holdings from the last disclosure made under sub-regulation (1) or under this sub-regulation; and such change exceeds two per cent of total shareholding or voting rights in the target company, in such form as may be specified.] 109[Provided that in case of listed entity which has listed its specified securities on Innovators Growth Platform, any reference to “five per cent” shall be read as “ten per cent” and any reference to “two per cent” shall be read as “five per cent”.] (3) The disclosures required under sub-regulation (1) and sub-regulation (2) shall be made within two working days of the receipt of intimation of allotment of shares, or the acquisition 110[or the disposal] of shares or voting rights in the target company to,— (a) every stock exchange where the shares of the target company are listed; and (b) the target company at its registered office. (4) For the purposes of this regulation, shares taken by way of encumbrance shall be treated as an acquisition, shares given upon release of encumbrance shall be treated as a disposal, and disclosures shall be made by such person accordingly in such form as may be specified: 107 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013, w.e.f. 26-03-2013. Prior to its substitution, sub-regulation (2) read as under: “(2)Any acquirer, who together with persons acting in concert with him, holds shares or voting rights entitling them to five per cent or more of the shares or voting rights in a target company, shall disclose every acquisition or disposal of shares of such target company representing two per cent or more of the shares or voting rights in such target company in such form as may be specified.” 108 Substituted for “Any person, who together” by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021, w.e.f. 1-4-2022. 109 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021, w.e.f. 05-05-2021. 110 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Page 70 of 79 Provided that such requirement shall not apply to a scheduled commercial bank or public financial institution 111[or a housing finance company or a systemically important non-banking financial company] as pledgee in connection with a pledge of shares for securing indebtedness in the ordinary course of business. 112[Explanation. - For the purpose of this sub-regulation, - A. a “housing finance company” means a housing finance company registered with the National Housing Bank for carrying on the business of housing finance and is either deposit taking or having asset size worth rupees five hundred crores or more; and B. a “systemically important non-banking financial company” shall have the same meaning as assigned to it in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018.] 113[ 30 ***] Disclosure of encumbered shares. 31(1) The promoter of every target company shall disclose details of shares in such target company encumbered by him or by persons acting in concert with him in such form as may be specified: 114 [Provided that the aforesaid disclosure requirement shall not be applicable where such encumbrance is undertaken in a depository.] 111 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2018 w.e.f. 31-12-2018 112 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2018 w.e.f. 31-12-2018. 113 Omitted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021, w.e.f. 1-4-2022. Prior to the omission, regulation 30 read as under: “Continual disclosures. 30 (1) Every person, who together with persons acting in concert with him, holds shares or voting rights entitling him to exercise twenty-five per cent or more of the voting rights in a target company, shall disclose their aggregate shareholding and voting rights as of the thirty-first day of March, in such target company in such form as may be specified. (2) The promoter of every target company shall together with persons acting in concert with him, disclose their aggregate shareholding and voting rights as of the thirty-first day of March, in such target company in such form as may be specified. (3) The disclosures required under sub-regulation (1) and sub-regulation (2) shall be made within seven working days from the end of each financial year to, — (a) every stock exchange where the shares of the target company are listed; and (b) the target company at its registered office.” 114 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021, w.e.f. 1-4-2022. Page 71 of 79 (2) The promoter of every target company shall disclose details of any invocation of such encumbrance or release of such encumbrance of shares in such form as may be specified: 115 [Provided that the aforesaid disclosure requirement shall not be applicable where such encumbrance is undertaken in a depository.] (3) The disclosures required under sub-regulation (1) and sub-regulation (2) shall be made within seven working days from the creation or invocation or release of encumbrance, as the case may be to,— (a) every stock exchange where the shares of the target company are listed; and (b) the target company at its registered office. 116[(4) The promoter of every target company shall declare on a yearly basis that he, along with persons acting in concert, has not made any encumbrance, directly or indirectly, other than those already disclosed during the financial year. (5) The declaration required under sub-regulation (4) shall be made within seven working days from the end of each financial year to – (a) every stock exchange where the shares of the target company are listed; and (b) the audit committee of the target company.] 117[CHAPTER V-A POWER TO RELAX STRICT ENFORCEMENT OF THE REGULATIONS Exemption from enforcement of the regulations in special cases. 31A (1) The Board may, exempt any person or class of persons from the operation of all or any of the provisions of these regulations for a period as may be specified but not exceeding twelve months, for furthering innovation 118[***] relating to testing 115 Inserted by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021, w.e.f. 1-4-2022. 116 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2019 w.e.f. 29-07-2019. 117 Inserted by the SEBI (Regulatory Sandbox) (Amendment) Regulations, 2020, w.e.f. 17-04-2020. 118 The words “in technological aspects” omitted by the SEBI (Regulatory Sandbox) (Amendment) Regulations, 2021, w.e.f. 3-8-2021. Page 72 of 79 new products, processes, services, business models, etc. in live environment of regulatory sandbox in the securities markets. (2) Any exemption granted by the Board under sub-regulation (1) shall be subject to the applicant satisfying such conditions as may be specified by the Board including conditions to be complied with on a continuous basis. Explanation. — For the purposes of these regulations, "regulatory sandbox" means a live testing environment where new products, processes, services, business models, etc. may be deployed on a limited set of eligible customers for a specified period of time, for furthering innovation in the securities market, subject to such conditions as may be specified by the Board.] CHAPTER - VI MISCELLANEOUS Power to issue directions. 32.(1) Without prejudice to its powers under Chapter VIA and section 24 of the Act, the Board may, in the interest of investors in securities and the securities market, issue such directions 119[or any other order] as it deems fit under section 11 or section 11B or section 11D of the Act, including,— (a) directing divestment of shares acquired in violation of these regulations, whether through public auction or in the open market, or through an offer for sale under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, and directing the appointment of a merchant banker for such divestiture; (b) directing transfer of the shares, or any proceeds of a directed sale of shares acquired in violation of these regulations to the Investor Protection and Education Fund established under the Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009; (c) directing the target company or any depository not to give effect to any transfer of shares acquired in violation of these regulations; 119 Inserted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Page 73 of 79 (d) directing the acquirer or any person acting in concert, or any nominee or proxy not to exercise any voting or other rights attached to shares acquired in violation of these regulations; (e) debarring any person who has violated these regulations from accessing the capital market or dealing in securities for such period as may be directed, having regard to the nature and gravity of the violation; (f) directing the acquirer to make an open offer for acquiring shares of the target company at such offer price as determined by the Board in accordance with these regulations; (g) directing the acquirer not to cause, and the target company not to effect, any disposal of assets of the target company or any of its subsidiaries contrary to the contents of the letter of offer, where the conditions set out in the proviso to sub-regulation (2) of regulation 25 are not met; (h) directing the acquirer who has failed to make an open offer or has delayed the making of an open offer, to make the open offer and to pay interest at such rate as considered appropriate by the Board along with the offer price; (i) directing the acquirer who has failed to make payment of the open offer consideration to shareholders, not to make any open offer or enter into any transaction that would attract the obligation to make an open offer in respect of shares of any target company for such period as the Board may deem fit; (j) directing the acquirer who has made an open offer but has delayed making payment of the open offer consideration to shareholders, to pay interest at such rate as considered appropriate by the Board for the delayed period; (k) directing any person to cease and desist from exercising control acquired over any target company without complying with the requirements under these regulations; (l) directing divestiture of such number of shares as would result in the shareholding of an acquirer and persons acting in concert with him being limited to the maximum permissible non-public shareholding or below. (2) In any proceedings initiated by the Board, the Board shall comply with principles of natural justice before issuing directions to any person. Page 74 of 79 (3) The Board may, for failure to carry out the requirements of these regulations by any intermediary registered with the Board, initiate appropriate proceedings in accordance with applicable regulations. Power to remove difficulties. 33. In order to remove any difficulties in the interpretation or application of the provisions of these regulations, the Board 120[may issue clarifications or guidelines from time to time]: 121[*** ] Amendment to other regulations. 34. The regulations specified in the Schedule shall be amended in the manner and to the extent stated therein. Repeal and Savings. 35.(1) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, 122[stands] repealed from the date on which these regulations come into force. (2) Notwithstanding such repeal,— (a) anything done or any action taken or purported to have been done or taken including comments on any letter of offer, exemption granted by the Board, fees collected, any adjudication, enquiry or investigation commenced or show-cause notice issued under the repealed regulations, prior to such repeal, shall be deemed to have been done or taken under the corresponding provisions of these regulations; (b) the previous operation of the repealed regulations or anything duly done or suffered thereunder, any right, privilege, obligation or liability acquired, 120 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “shall have the power to issue directions through guidance notes or circulars”. 121 Omitted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to its omission, it read as “Provided that where any direction is issued by the Board in a specific case relating to interpretation or application of any provision of these regulations, it shall be done only after affording a reasonable opportunity of being heard to the concerned persons and after recording reasons for the direction”. 122 Substituted by the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2018, w.e.f. 11-09-2018. Prior to this, it read as “stand”. Page 75 of 79 accrued or incurred under the repealed regulations, any penalty, forfeiture or punishment incurred in respect of any offence committed against the repealed regulations, or any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, shall remain unaffected as if the repealed regulations has never been repealed; (c) any open offer for which a public announcement has been made under the repealed regulations shall be required to be continued and completed under the repealed regulations. (3) After the repeal of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, any reference thereto in any other regulations made, guidelines or circulars issued thereunder by the Board shall be deemed to be a reference to the corresponding provisions of these regulations. SCHEDULE [See regulation 34] Amendment to Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009. (i) In regulation 3, in clause (f), for the full stop, the symbol “:” shall be substituted; (ii) In regulation 3, after clause (f), the following new proviso shall be inserted, namely: - “Provided that the provisions of these regulations shall not apply to issue of securities under clause (b), (d) and (e) of sub-regulation (1) of regulation 9 of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.”; (iii) In regulation 74, after sub-regulation (2), the following new sub-regulation shall be inserted:- “(3) Notwithstanding anything contained in this regulation, where a preferential allotment is made that attracts an obligation to make an open offer for shares of the issuer under Securities and Exchange Board of India Page 76 of 79 (Substantial Acquisition of Shares and Takeovers) Regulation, 2011, and there is no offer made under sub-regulation (1) of regulation 20 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011, the period of fifteen days shall be counted from the expiry of the period specified in sub-regulation (1) of regulation 20 or date of receipt of all statutory approvals required for the completion of an open offer under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011: Provided that if an offer is made under sub-regulation (1) of regulation 20 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011, the period of fifteen days shall be counted from the expiry of the offer period as defined in the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011: Provided further that the provisions of this sub-regulation shall not apply to an offer made under sub-regulation (1) of regulation 20 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011, pursuant to a preferential allotment.”; (iv) In Schedule VIII, in part E, in paragraph 5, in clause (VI), in sub-clause (C), after item 6, the following new item shall be inserted, namely: - “(6A) Disclosure of ex-rights price as referred under clause of (b) of sub- regulation 4 of regulation 10 of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011.” U. K. SINHA CHAIRMAN SECURITIES AND EXCHANGE BOARD OF INDIA **************** Page 77 of 79 Note: 1. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 were published in the Gazette of India on September 23, 2011 vide notification No. LAD- NRO/GN/201112/24/30181. 2. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 was amended- a. March 26, 2013 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2013 vide No. LAD-NRO/GN/201213/36/7368. b. October 8,2013 by the Securities and Exchange Board of India (Listing of Specified Securities on Institutional Trading Platform)Regulations vide No. LAD-NRO/GN/2013-14/28/6720. c. May 23, 2014 by the Securities and Exchange Board of India (Payment of Fees) (Amendment) Regulations, 2014 vide Notification No. LAD-NRO/GN/2014-15/03/1089. d. March 24, 2015 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2015 vide No. LAD-NRO/GN/2014-15/28/542. e. May 5, 2015 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2015 vide No. SEBI/LAD- NRO/OIAE/GN/2015-16/004. f. August 14, 2015 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2015 vide No. SEBI/LAD NRO/GN/2015- 16/009. g. December 22, 2015 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Fourth Amendment) Regulations, 2015 vide No. SEBI/LAD- NRO/GN/2015-16/026. h. February 17, 2016 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2016 vide No. SEBI/LAD- NRO/GN/2015-16/035. i. May 25, 2016 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations,2016vide No. SEBI/LAD-NRO/GN/2016- 17/002. Page 78 of 79 j. March 6, 2017 by the Securities and Exchange Board of India (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2017 vide No. SEBI/LAD/NRO/GN/2016-17/037 read with notification dated March 29, 2017 vide No. SEBI/LAD/NRO/GN/2016-17/38. k. August 14, 2017 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2017 vide No. SEBI/LAD-NRO/GN/2017-18/015. l. June 1, 2018 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2018 vide No. SEBI/LAD-NRO/GN/2018/20. m. September 11, 2018 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations,2018 vide No. SEBI/LAD- NRO/GN/2018/33. n. December 31, 2018 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2018 vide No. SEBI/LAD-NRO /GN/ 2018/55. o. March 29, 2019 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2019 vide No. SEBI/LAD-NRO /GN/ 2019/06. p. July 29, 2019 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2019 vide No. SEBI/LAD-NRO /GN/ 2019/27. q. April 17, 2020 by the Securities and Exchange Board of India (Regulatory Sandbox) (Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO/GN/2020/10. r. June 16, 2020 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO /GN/ 2020/14. s. June 22, 2020 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO /GN/ 2020/19. t. July 1, 2020 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO /GN/ Page 79 of 79 2020/20. u. May 5, 2021 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO /GN/ 2021/19. v. August 3, 2021 by the Securities and Exchange Board of India (Regulatory Sandbox) (Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO/GN/2021/30. w. August 13, 2021 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO /GN/ 2021/46. x. December 6, 2021 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Third Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO /GN/ 2021/60. y. November 9, 2022 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2022vide No. SEBI/LAD- NRO/GN/2022/98. z. February 7, 2023 by the Securities and Exchange Board of India (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2023vide No. SEBI/LAD-NRO/GN/2023/121. aa. May 18, 2024 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2024 vide No. LAD-NRO/GN/2024/179. bb. November 28, 2024 by the Securities and Exchange Board of India (Attestation of Documents) (Amendment) Regulations, 2024 vide No. LAD-NRO/GN/2024/212. cc. December 5, 2025 by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2025 vide No. LAD-NRO/GN/2025/283. *** [This note does not form a part of the regulations.]