Moneycontrol was the first to report that PNB Housing Finance was likely to move the Securities Appellate Tribunal and challenge the directions from SEBI.
PNB Housing Finance has filed an appeal at the Securities Appellate Tribunal
PNB Housing Finance has filed an appeal at the Securities Appellate Tribunal challenging the directions by SEBI relating to the valuation procedure of the former’s Rs 4,000 crore transaction with a consortium led by private equity giant Carlyle. The consortium includes former HDFC Bank MD and CEO Aditya Puri and private equity funds General Atlantic and Ares SSG. PNB Housing Finance made the announcement in a disclosure to the stock exchanges.
On June 20, Moneycontrol was the first to report that the public sector lender was likely to move the Securities Appellate Tribunal and challenge the directions from SEBI.
In a letter sent to the public sector lender last week, the market regulator halted the deal temporarily and said the notice for an EGM ( Extraordinary General Meeting ) scheduled for June 22 was not consistent with the firm’s articles of association . SEBI directed the lender to undertake the valuation exercise based on the firm’ articles of association.
The market regulator said that the notice given on May 31 for Extraordinary General Meeting is “ultra-vires of Article of Association (AOA) and shall not be acted upon until the company undertakes the valuation of shares as prescribed under 19(2) of AOA, for purpose of preferential allotment, from an independent registered valuer as per the provisions of applicable laws. The said report shall be considered by the Company’s Board while deciding on the preferential issue of shares and warrants.”
The high-profile deal has been shrouded in controversy. Moneycontrol was the first to report that Sebi is examining the deal after a proxy advisory firm, SES (Stakeholders Empowerment Services) led by former Sebi ED JN Gupta, questioned the proposed investment by the US private equity major over valuations and interest of minority shareholders.