Sebi grants exemption to NTPC for buy-back programme

New Delhi: Capital markets regulator Securities and Exchange Board of India (Sebi) on Friday granted exemption to state-run NTPC from certain buyback norms for the proposed merger of wholly-owned subsidiaries with the parent company.

In October, NTPC had filed an application with the Securities and Exchange Board of India to seek exemption from the strict enforcement of the buyback norms.

The application had been necessitated on account of a scheme of amalgamation providing for the merger of NTPC's wholly-owned subsidiaries with itself, a Sebi order said.

In November 2019, NTPC's board of directors had approved a scheme of amalgamation entailing the merger of Nabinagar Power Generating Company Ltd and Kanti Bijlee Utpadan Nigam Ltd with NTPC.

For this, the company proposes to explore the possibility of buying back its equity shares from the existing shareholders on proportionate basis through tender offer route, subject to the requisite approval, but such buy back will not be permitted certain provision of Buy-back Regulations since there is a scheme of amalgamation pending at the time of the public announcement.

The provision of buy-back norms, for which exemption is sought "prohibits the Company from making any public announcement of buy-back during the pendency of any scheme of amalgamation pursuant to the provisions of the Companies Act, 2013,"

Sebi noted.