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    Question

    Under Regulation 29(2) of SEBI (SAST) Regulations, 2011,

    any person who holds 5% or more shares/voting rights in a target company must disclose any change in shareholding if the change exceeds: 
    A 1% of total shareholding Correct Answer Incorrect Answer
    B 2% of total shareholding Correct Answer Incorrect Answer
    C 3% of total shareholding Correct Answer Incorrect Answer
    D 4% of total shareholding Correct Answer Incorrect Answer
    E 5% of total shareholding Correct Answer Incorrect Answer

    Solution

    Correct Answer: 2% of total shareholding Explanation: This is governed by Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

    • The Rule: If an acquirer already holds 5% or more shares or voting rights in a target company, they are required to make a disclosure for every acquisition or disposal of shares that aggregates to 2% or more of the shares or voting rights.
    • Timeline: This disclosure must be made to the company and the stock exchanges where the shares are listed within 2 working days of the receipt of intimation of allotment of shares or the acquisition/disposal of shares.
    • Purpose: This ensures transparency so that the market and the company are aware of significant changes in the holding pattern of major shareholders.

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