J Sridhar 21-08-2010

       REGULATED BY CENTRAL GOVERNMENT TILL 1992 HANDED OVER TO SEBI IN 1992 TAKEOVER CODE OF 1994 BHAGWATI COMMITTEE REPORT-1997 TAKE-OVER CODE OF 1997 ACHUTAN COMMITTEE –TRAC- 2010 PROPOSED CODE -2010

      DEFINITIONS EXEMPTIONS FROM 10,11,12 DISCLOSURES OF SHAREHOLDING & CONTROL TRIGGERS FOR OPEN OFFER-10, 11, 12 THE OPEN OFFER PROVISIONS, OFFER PRICE, OFFER QUANTUM, COMPETITIVE BID, ESCROW, WITHDRAWAL ETC BAIL OUT TAKEOVERS

       Transparent legal framework for facilitating takeover activities Protecting interests of investors and giving a fair, equitable and transparent framework To balance various conflicting objectives of various stake-holders To provide shareholders exit opportunities To ensure fair and accurate disclosure To regulate fair and effective competition To ensure good corporate governance

•DEFINITIONS •SUBSTANTIAL ACQUISITION OF SHARES/CONTROL •INDIRECT ACQUISITION •VOLUNTARY OFFER, OFFER SIZE, OFFER PRICE, MODE OF PAYMENT, ETC.

•GENERAL EXEMPTIONS FROM 3, 4 •OPEN OFFER PROCESS-TIMING, CONTENT, LETTER OF OFFER, ESCROW, CONDITIONAL OFFER, COMPETING OFFER, PAYMENT, COMPLETION, WITHDRAWAL OF OFFER, ETC.

•OBLIGATIONS – OF DIRECTORS, ACQUIRERS, TARGET COMPANY, ETC.

•MISCELLANEOUS

      New / amended definitions Control – right or ability to appoint majority of directors Delisting threshold – entitling exercise of 90% of voting rights Frequently traded shares – 10% in 12 preceding calendar months Identified date Maximum permissible non-public shareholding – minimum public shareholding under LA

     Promoter - – as defined under ICDR Regulations Promoter group – as defined under ICDR Regulations Tendering period Business day Identified date, etc.

FROM 15% TO 25%

15% TO 55% - 5% IN A FINANCIAL YEAR – ONE-TIME – 5% BETWEEN 55-75% 25% TO 75% - 5% IN A FINANCIAL YEAR.

   ONLY GROSS PURCHASES WILL BE CONSIDERED – NO NETTING OFF DIFFERENCE BETWEEN PRE-ISSUE SHARE CAPITAL AND POST ISSUE SHARE CAPITAL – TREATED AS ADDITIONAL ACQUISITION INTER-SE TRANSFERS – WILL BE TREATED AS ADDITIONAL ACQUISITION

ACQUISITION OF CONTROL IRRESPECTIVE OF SHARES – TRIGGER – EXEMPTION BY SHAREHOLDER RESOLUTION INDIRECT OR DIRECT ACQUISITION OF CONTROL – WHETHER WITH OR WITHOUT ACQUISITION OF SHARES. DEFINED DIRECT CONTROL

    3 CATEGORIES : Where Target Company is non-material-less than 15% of market cap, sales turnover or NAV Where Target Company is material-between 15 80% of market cap, sales turnover or NAV Where Target Company is over 80% of market cap, sales turnover or NAV- will be deemed to be direct acquisition

BETWEEN 55-75% - CAN MAKE FOR SUCH NUMBER AS NOT TO UPSET THE MINIMUM PUBLIC SHAREHOLDING IF HOLDING BEYOND 25% - CAN MAKE FOR A MINIMUM OF 10%.

WHEN COMPETITIVE BID RECEIVED – HIKE TO MAXIMUM

 ◦ ◦ WHO CANNOT MAKE?

ONE WHO HAS REACHED THE 25% HOLDING / ACQUIRED SHARES IN THE LAST 52 WEEKS.

THOSE WHO HAVE MADE AN OPEN OFFER CANNOT ACQUIRE SHARES FOR 6 MONTHS AFTER COMPLETION OF OPEN OFFER, EXCEPT THROUGH ANOTHER VOLUNTARY OPEN OFFER.

FOR MINIMUM 20% OF THE EXISTING PAID UP CAPITAL OF THE COMPANY 100% OF THE OUTSTANDING SHARES; VOLUNTARY OFFERS – MINIMUM10% ; MAXIMUM – NOT TO UPSET THE MINIMUM PUBLIC SHAREHOLDING LIMIT

NO SUCH OPTION CURRENTLY HAVE AN OPTION – MUST DECLARE UPFRONT.

IF NOT DECLARED – MUST EITHER BRING DOWN THE EXCESS HOLDING OR ACCEPT PROPORTIONATELY LESS FROM AGT AND OPEN OFFER. DECLARE WHICH OPTION UPFRONT

26 WEEK PRICE WITH OTHER PARAMETERS . DISTINGUISH BETWEEN FREQUENTLY TRADED AND INFREQUENTLY TRADED NOW REDUCED 60 DAY TRADING PRICE WITH OTHER PARAMETERS. DONE AWAY WITH INFREQUENTLY TRADED SHARE. METHODOLOGY DEFINED FOR DIRECT ACQUISITION AND INDIRECT ACQUISITION

     Highest of – Highest negotiated price under agreement attracting offer Volume weighted average price paid by acquirer during 52 weeks preceding PA Highest price paid during 26 weeks preceding PA Volume weighted average market price during 60 trading days preceding PA

      Highest of – Highest negotiated price under agreement attracting offer Volume weighted average price paid by acquirer during 52 weeks preceding PA Highest price paid during 26 weeks preceding PA

Highest price paid between the date of primary acquisition or announcement and date of PA

Volume weighted average market price during 60 trading days preceding PA

PREVALENT UPTO 25% HAS BEEN DONE AWAY WITH

      ◦ ◦ INTER-SE TRANSFER ◦ ONLY AMONGST IMMEDIATE RELATIVES ◦ AMONGST PROMOTERS – SHOWN AS SUCH IN THE SHAREHOLDING PATTERN FILED WITH SE IN THE LAST 3 YEARS AMONGST COMPANY, ITS HOLDING COMPANY AND SUBSIDIARIES AMONGST PERSONS ACTING IN CONCERT ACQUISTIONS BY STOCK BROKER, MERCHANT BANKER, UNDERWRITER ACQUISTIONS PURSUANT TO ◦ A BIFR SCHEME ◦ ARRANGEMENT, MERGER, AMALGAMATION AS APPROVED BY COURT ACQUISITION PURSUANT TO DELISTING ACQUISITION PURSUANT TO TRANSMISSION, SUCCESSION OR INHERITANCE ACQUISITION BY OPERATION OF SECTION 87(2) OF COMPANIES ACT.

   ◦ ◦ ◦ ◦ ONLY UNDER REGULATION 3 AS RECOMMENDATIONS UNDER CDR ACQUISITON BY A CONSORTIUM OF BANKS AND FINANCIAL INSTITUTIONS, CONSEQUENT TO INVOCATION OF PLEDGE RETRANSFER OF PLDEDGED SHARES BY PLEDGEE TO PLEDGOR (GROUP EXEMPTION REMOVED) ◦ PURSUANT TO BUY BACK ( REGULATION 3(1)) IN EXCESS OF 25% ◦ ◦ EXEMPTION FROM REGULATION 3(2) RIGHTS ISSUE BUY BACK

COMPULSORY REFERENCE TO PANEL FOR EXEMPTIONS.

OPTIONAL REFERENCE TO PANEL.

MORE ITEMS FOR WHICH REPORT IS TO BE FILED WITH SEBI WITHIN 21 DAYS

WITHIN 4 WORKING DAYS ON THE DATE OF DECIDING TO ACQURING SHARES.

FOR ORDERS THROUGH STOCK BROKER – BEFORE PLACING ORDER.

ON CONVERSION WITH NO FIXED DATE – SAME DAY AS DATE OF CONVERSION CONVERSION WITH FIXED DATE – 2 BUSINESS DAYS BEFORE INDIRECT ACQUISITION – WITHIN 5 DAYS OF PRIMARY CONTRACT DIRECT ACQUISITION – ON THE SAME DAY OF PRIMARY CONTRACT ANY OTHER – WITHIN 2 BUSINESS DAYS OF INTENTION

ONLY PUBLIC ANNOUNCMENT PUBLIC ANNOUNCMENT TO THE STOCK EXCHANGES & PUBLIC STATEMENT TO BE ISSUED IN THE NEWSPAPERS

      WITHIN 5 BUSINESS DAYS OF PUBLIC STATEMENT – FILE LETTER OF OFFER WITHIN 15 BUSINESS DAYS – COMMENTS FROM SEBI WITHIN 7 BUSINESS DAYS OF RECEIPT OF COMMENTS – DESPATCH LETTER OF OFFER TENDERING PERIOD – NOT LATER THAN 12 BUSINESS DAYS FROM DATE OF RECEIPT OF COMMENTS OPEN – FOR 10 BUSINESS DAYS PAYMENT – WITHIN 10 BUSINESS DAYS

    Conditional offers as to minimum level of acceptance – 100% of consideration for minimum level to be put in ESCROW Competing offers – an acquirer having made a voluntary offer can switch to normal full-size offer when a competing offer is made Agreement triggering offer obligation can be acted upon on 100% payment in ESCROW Material transactions during the offer period cannot be done without shareholders’ approval.

      COMPETITIVE OFFER WITHIN 15 BUSINESS DAYS.

NO WITHDRAWAL OF SHARES OFFERED BY SHAREHOLDERS OPINION WITH REASONED RECOMMENDATIONS BY COMMITTEE OF INDEPENDENT DIRECTORS ON OPEN OFFER ACQN TO BE COMPLETED W/I 57 DAYS FROM PA ESCROW – 25% ON FIRST RS.500 CR + 10% ON BALANCE MODE OF PAYMENT – THROUGH CASH, ISSUE, EXCHANGE OR TRANSFER OF SECURITIES

       UPTO 24.99% - NO ACTION 25% AND ABOVE – MAKE OPEN OFFER-100% PERSONS HOLDING ABOVE 25% BUT LESS THAN 75% - CAN CREEP BY 5% EVERY YEAR VOLUNTARY OFFERS FOR MINIMUM 10%, IF HOLDING BEYOND 25% OPEN OFFER, IF ACQUIRING CONTROL EITHER DIRECTLY OR INDIRECTLY NO COMPETE FEE GOOD, PROGRESSIVE CODE

THANK YOU