BSE, NSE to provide e-book mechanism in pvt placement of debts
The mechanism would streamline procedures for issuance of debt securities on private placement basis, enhancing efficiency, transparency of the price discovery mechanism and improving liquidity in the secondary market.
It would come into effect from July 1, 2016. “BSE...gets another feather in its hat by receiving Sebi’s accord to launch electronic book mechanism for issuance of debt securities on private placement,” the exchange said in a statement. “Known as BSE BOND (BSE Bidding Online for Debt), this would ensure transparency while dealing in debt securities,” it added.
In a separate circular, NSE said it will act as an Electronic Book Provider (EBP) to facilitate electronic book mechanism for issuance of debt securities on private placement basis. All investors, including institutional as well as High Net Worth Individual (HNI) arrangers, are allowed to bid through this platform. According to Sebi norms, any issuer can use the electronic book mechanism.
However, an issuer coming out with an issue of more than Rs 500 crore (inclusive of the Greenshoe option) would have to mandatorily use this system.